News and updates from the continent

NEPAD Agency: Fast-tracking African energy projects

NEPAD Agency:  Fast-tracking African energy projects

Dec 2, 2014

The introduction of the NEPAD Agency’s Africa Sustainable Energy Incubator Platform will take place alongside the Africa Private Sector Forum at the Planari Hotel in Nairobi from 3 to 5 December. The platform, which is a NEPAD Agency initiative, in collaboration with the ACP Business Climate Facility (BizClim), a programme of the ACP Group of States funded by the European Union, aims to fast-track African sustainable energy development projects.

The initiative is described as ‘The meeting point for energy project developers and investors’. It connects energy project developers and investors, supports project development through access to expert mentors and serves as a knowledge hub for this fast-growing sector.

The business support tools help to streamline  projects, assist  developers to structure their business proposals, shorten the time cycle for access to cash and equities, provide better  pre-diligence for investors and establish finance products in association with blended funding partners.

Dr Ibrahim Mayaki, NEPAD Agency Chief Executive Officer, says NEPAD’s vision for a sustainable and inclusive approach to empowering Africa is complimented by frontline energy project developers who are delivering appropriate energy and fuel solutions. Africa also needs equally dynamic investors who can help to accelerate the expansion of affordable and sustainable energy, he notes. “We would like to make the NEPAD Agency incubator test platform a future catalyst to strengthen our own coordination with African Governments and Agencies and promote this platform as an exchange to build common equity for developers and investors.  We can and will bridge the investment gaps that have for too long restricted growth.”

In Nairobi this week, a leading panel of investors from Europe and Africa, key agencies and industry mentors from the energy sector will participate in a dedicated session titled “5th Plenary Session on Sustainable Energy Impact Investment” will debate alternative solutions to securitising risk capital to accelerate private sector energy projects.

The plenary session on the morning of 4 December will be addressed by Professor Mosad Elmissiry, Head of the NEPAD Energy Division and the test incubator GEN-HUB platform author Gavin Maxwell -Key Expert. The session will further explore innovative funding mechanisms, present the outputs of the NEPAD Agency’s Pan Africa Sustainable Energy Incubation and Investment Project and offer opportunities to enable impact grade finance to support energy developers across Africa.

The Platform development in 2014 examined the real-world restriction and difficulties that Project Developers face when seeking Risk financing.  The platform could play an important role in overcoming these hurdles.

Developers find that there is only limited appetite for risk even in the developed economies and the problem is even more acute in regions of Africa, where credit assurance is endemically weak.  New forms of “Impact finance” could provide a realistic solution to Developer challenges and deliver sustainable returns to Investors.

On the back of the pilot phase of the incubator test platform – GEN-HUB Africa, in which support was facilitated for 20 projects, seven of which seven are now being promoted with a combined seed capital requirement of USD12 million, the Africa Private Sector Forum in Nairobi this week will provide a platform for Energy Project Developers to demonstrate the benefits of being members of a focused investment hub which helps to validate their technical and capital needs.

It will further review the progress and challenges encountered in developing knowledge and investment for energy projects.

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