EU bank announces new financing to strengthen access to energy in Africa via the development of off-grid solar systems

Today, Vice-President of the European Investment Bank (EIB – the EU bank) Ambroise Fayolle announced the signature of USD 25m in financing with d.light design to strengthen access to energy in Africa via solar kits that do not require a grid, are easy to use and inexpensive for users thanks to a pre-payment system. Particular emphasis will be placed on rural and suburban populations and micro-entrepreneurs.

This EU financing will enable d.light design to develop the installation of solar kits – including not only panels and lamps but also low-energy equipment (radios, TVs, etc.) – in sub-Saharan Africa with the ambitious goal of reaching 10 million solar installations within five years.

“I am delighted that the EIB has signed this new financing with d.light in Africa for an off-grid solar project that will have a major economic and social impact on people and micro-entrepreneurs,” said EIB Vice-President Ambroise Fayolle. “The EU bank is determined to implement the Paris climate agreement and to cooperate to achieve the sustainable development goals, particularly when it comes to ensuring access to affordable, reliable and sustainable energy for all. With its unique technical and financial expertise in the support of solar projects, the EIB will mobilise new investments to develop renewable energies in Africa.”

The installation of these off-grid solar systems with d.light will initially take place in Ethiopia, Kenya, Nigeria, Tanzania and Uganda.

Renewable energy development – a priority for the EIB

For the EU bank, climate action and the development of renewable energies are major priorities both inside and outside the EU. At the founding ceremony of the International Solar Alliance that recently took place in New Delhi, the EIB emphasised its record investment of EUR 1bn into the development of global solar projects in 2017. The Bank also confirmed that it would be significantly expanding its activities in support of solar energy in developing and emerging economies. Since 2002, the EIB has allocated EUR 6.3bn to financing solar projects, with 50% going to emerging and developing economies.

An outstanding partnership with Afric

The EIB has fostered an outstanding long-term partnership with the African continent. Since its creation by the Treaty of Rome and the beginning of its operations in Africa, the EU bank has invested around EUR 25bn in support of more than 1 300 public and private sector projects, helping to revitalise companies and improve day-to-day living standards. The EIB has intensified its investments since 2014, with the signature of EUR 8.8bn in new financing to support infrastructure and the private sector across the African continent.

Note to editors

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States, and is the largest international public sector bank in the world. It provides long-term finance in support of quality projects to contribute to the achievement of the EU’s key objectives.

For more information about impact financing in Africa:

For more information about the Boost Africa initiative to support entrepreneurs:

What is Boost Africa?

Africa has some of the world’s fastest-growing economies and a young, quickly growing population. However, a consistent trend in young graduates leaving or failing to return home at the end of their studies is an increasing threat for the continent’s social, economic and technological progress.

Boost Africa, a joint initiative between the African Development Bank (AfDB) and the European Investment Bank (EIB), seeks to harness the continent’s potential, and create opportunity on the ground through:

• enabling and enhancing entrepreneurship and innovation across Africa
• creating new and quality jobs for young Africans
• contributing to the development of an efficient entrepreneurial ecosystem in Africa
• addressing the financing gap at the earliest and riskiest stages of enterprise creation
• developing and strengthening skills and expertise with young entrepreneurs

Boosting the entrepreneurial power of Africa’s young people will:

• create innovative and compelling modern businesses
• increase the capacity for these businesses to compete regionally and globally
• attract both domestic and foreign investment and diversify investor profile
• contribute significantly to job creation and economic growth

The idea is to become the premier platform to launch globally competitive companies from Africa.

Boost Africa stems from a belief in entrepreneurship and innovation, and that both can play a significant role in accelerating living standards and social progress in Africa by meeting the needs of the people.

It will support the development of affordable solutions to fundamental challenges affecting those at the base of the pyramid, from access to energy and healthcare to financial services, education and internet connectivity. Supporting start-ups also means sustaining the democratisation of the economy, in a context characterised by an unequal distribution of wealth and high barriers for newcomers to start a business.

Driving private sector growth is the priority for the EIB on the African continent. Boost Africa represents a new way for us to do that, in accordance with the Sustainable Development Goals, which call for the creation of good jobs and sustainable growth while alleviating the effects of poverty. This project does exactly that.

What are the components of Boost Africa?

Through this integrated approach, Boost Africa will both provide financial capital and develop human capital, helping fund managers and entrepreneurs to effectively deal with the many obstacles that arise when building new funds and new enterprises.

Development impact

The overall target size across the various components of the initiative is expected to be around EUR 250m, leveraging EUR 1 billion in investments, supporting 1,500 SMEs and creating 25,000 direct jobs and at least 70,000 indirect jobs.

What types of sectors does Boost Africa target?

The focus will be on sectors where innovations can improve the quality of people’s lives, in particular that of poorer households, providing access to affordable products and services. These sectors include, but are not limited to:

• ICT
• agribusiness
• financial services and financial inclusion
• health
• education
• renewable energy

There will be a particular emphasis on intermediaries that focus on youth and women as final beneficiaries.

Source: eib.org