Africa50 Featured at Africa Energy Forum

On June 7 in Copenhagen, Africa50 CEO Alain Ebobisse and Africa50 Project Development Director Koffi Klousseh were featured participants in the annual Africa Energy Forum.

Mr. Ebobisse moderated the round table on “The New Deal on Energy for Africa – the Way Forward“, which focused on the latest AfDB initiative for improving energy coverage in Africa. He was joined by two African ministers, David Mabumba, Minister of Energy and Water Development, Zambia, and Henry Macauley, Minister of Energy, Sierra Leone, as well as Augusto de Sousa Fernando, Deputy Minister of Mineral Resources and Energy, Mozambique. Other speakers included Martin Bille Herman, State Secretary for Development Policy, Ministry of Foreign Affairs, Denmark; Andrew M. Herscowitz, Coordinator, Power Africa; Lucio Monari, Director, Energy and Extractive Global Practice, World Bank; Abel Didier Tella, Director-General, Association of Power Utilities of Africa; Mike Scholey, COO and CFO, Globeleq; and Bruno Bensasson, Chief Executive Officer, ENGIE Africa. Henry Paul Batchi Baldeh, Director of Power Systems Development of the AfDB gave the feature address.

This roundtable will discuss what is required to achieve the New Deal’s objective of universal energy access in Africa by 2025, focusing on what countries and other stakeholders must do to attract the required investment, notably from the private sector. It will also provide an opportunity for partners to provide feedback on the new approaches and financing vehicles under development or promoted by the AfDB. In fact, you may even provide feedback on my organization, Africa50, which was also created at the initiative of Africa50.

As you know, Africa is the region with the largest energy access deficit. According to AfDB analysis, universal energy access in Africa by 2025 would require 160 GW of new generation capacity; 130 million new on-grid connections, and 75 million off-grid connections, as well as access to clean cooking energy for around 130 million households.

This will necessitate action by both the public and private sectors. Let me just name a few things that need to be done on the government side. Most importantly, governments must improve the enabling environment and create sufficiently robust sectors to attract investments. This requires them to develop credible sector policies and to apply them consistently over time. It is also very important that governments build the capacity in the public-sector, including for utilities, and when needed seek input from experienced advisors to facilitate the design and negotiation of PPP agreements. The objective of these actions, and those by all the sector stakeholders, is to increase the number of viable, bankable energy projects. 

And on that subject, allow me to briefly introduce Africa50, since one of our mandates is precisely to help increase the number of bankable private and PPP energy projects in Africa.

Africa50 was created at the initiative of the African Development Bank, with the support of African states, to help bridge the infrastructure gap in Africa. With a shareholder base that includes so far 23 African countries, the AfDB and two central banks, we can create a bridge between the public and private sectors to facilitate private investment in infrastructure, with a strong focus on power. These shareholders have committed over $800 million in equity capital to the Fund and have given us the mandate to operate commercially. Broadly speaking we have two investment businesses.

Our Project Development arm’s objective is to increase the pipeline of viable projects by working with governments and partners to speed up project development. Our other arm, Project Finance, seeks to support projects which are a bit more advanced in their life cycle--near financial close, under construction or already operational.  We will typically support projects or platforms as a strategic minority partner with equity or quasi-equity alongside strong partners.

We cover most of the sub-sectors in the infrastructure space. In the power sector, we have a strong appetite for investing in Independent Power Producers, but we are also ready to invest in other forms of Public Private Partnerships across the power sector value chain, such as distribution and transmission Private or PPP projects.

Mr. Klousseh participated in the panel “Effective Blending of Financing for Renewable Energy”. He was joined by Brunno Maradei, Senior Investment Officer, Project Finance and Guarantees, EIB; Jasandra Nyker, CEO, BioTherm Energy; Svetoslav Gatchev, Managing Director, Delphos International; Lucy Chege, General Manager, Infrastructure Finance, Energy, Environment and PPPs, Development Bank of Southern Africa; Ragnar Gerig, Director, Project Finance, Energy Africa and Asia, DEG; and Martin Kavanagh, Partner Energy and Infrastructure Finance, Herbert Smith Freehills.

In his remarks, Mr. Klousseh focused on how blended finance can be used catalytically for early stage financing of project development, especially in energy sectors that are perceived to be riskier by investors and project developers.