AfricaGoGreen Fund Raises $47 Million in Equity Investments to Fund Climate-friendly Projects in Africa
The International Finance Corporation (IFC), the African Development Bank (AfDB), the Nordic Development Fund (NDF), and the Sustainable Energy Fund for Africa have all contributed $47 million to the AfricaGoGreen Fund (AGGF) (SEFA)
The funding will allow AGGF to fund more climate-friendly projects in Africa, such as the purchase of high-efficiency appliances and industrial equipment, the repair of old buildings and the construction of new green buildings, and the installation of solar panels and battery storage on the roofs of homes, businesses, and factories.
“KfW is glad to welcome the new investors to the AfricaGoGreen Fund, which was initiated with seed capital from the German Government. We hope that other investors will follow suit. This successful second round of fundraising shows that the fund is on track to play a critical role in Africa’s just energy transition,” said Johannes Scholl, Head of Division at KfW.
“IFC is collaborating with AfricaGoGreen because its innovative energy efficiency focus provides critical capital to businesses that are supporting the region’s energy transformation while also expanding access to electricity, green building, and e-mobility solutions,” said Henrik Elschner Pedersen, IFC Regional Industry Director in Africa for Manufacturing, Agribusiness, and Services.
IFC provided $17 million in equity as part of the funding, which included money from the IDA20 Private Sector Window Blended Finance Facility. IFC also provided $30 million in debt, giving AGGF the long-term capital it needed to complete the second close fundraise.
Each of the Sustainable Energy Fund for Africa, the Nordic Development Fund, and the African Development Bank invested $10 million. Calvert Impact Capital paid off an additional $10 million in debt in December 2022.
AGGF is the first structured debt fund in Africa focused on energy efficiency solutions, launched by KfW on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ) in early 2021 and managed by LHGP Asset Management.
The fund’s final close goal is to raise between $230 million and $250 million. The current fundraising round brings total funding to $138 million, demonstrating that the fund is gaining traction in order to reach its full potential.
Since its inception, AGGF has invested in AktivCo, a telecom energy services company, to develop clean energy solutions for powering telecommunication towers in Burkina Faso, Cameroon, Chad, Côte d’Ivoire, and Niger, as well as BBOXX, a pay-as-you-go solar-powered solutions provider, to help millions of Africans gain access to clean cooking solutions.
AGGF also recently completed the Solarise transaction, which invests in energy-efficient appliances in Kenya, South Africa, and Mauritius, and increased the size of both the AktivCo and BBOXX transactions.
“IFC is partnering with AfricaGoGreen because its innovative energy efficiency focus is making critical capital available to businesses that are supporting the region’s energy transformation while also expanding access to electricity, green building, and e-mobility solutions,” said Henrik Elschner Pedersen, IFC Regional Industry Director in Africa for Manufacturing, Agribusiness, and Services.
