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Development finance institution FinDev Canada has invested $13 million into the Energy Entrepreneur Growth Fund (EEGF). This funding will be reinvested in early and growth-stage energy startups in sub-Saharan Africa. A portion of this fund will be utilized for increasing access to clean electricity for off-grid households and businesses in the region.
The $120 million EEGF was established by the UK-based charity Shell Foundation and Dutch development bank, FMO in 2019 to provide catalytic financing and technical assistance to early and growth-stage startup companies in sub-Saharan Africa which are operating in the energy access market. EEGF targets to accelerate the achievements of UN Sustainable Goal 7 of ensuring access to affordable, reliable, and sustainable energy for all by 2030.
FinDev Canada has invested in EEGF through its 2X Canada: Inclusive Economic Recovery program, a recent initiative established with funding from Global Affairs Canada. The aim of the program is to support the recovery of economies of the region that is affected by the Covid-19 pandemic. The program will help in accelerating clean energy innovation in the African energy sector after the Covid-19 slowdown.
FinDev Canada Vice President and Chief Investment Officer, Paulo Martelli said “The pandemic has slowed down electrification in Africa, which was already behind before the health crisis. By increasing EEGF’s capacity to invest in this sector, FinDev Canada and its 2X Canada facility support energy companies committed to expanding access to clean and reliable energy for African households and businesses, leading to inclusive and sustainable growth and the improvement of millions of lives.”
Shell Foundation Operations Director, Gareth Zahir-Bill noted the importance of understanding the basic need of the entrepreneurs in the clean energy sector for achieving just and inclusive energy transition. He also thanked FinDev Canada’s funding that will expand the provision of flexible financial solutions for clean and reliable energy access in Africa, alleviating energy poverty and mitigating climate change.
FinDev’s investment in EEGF will help to catalyze the deployment of renewable energy infrastructure in Africa and thus enable clean electrification. Last year the EEGF invested in clean energy startups Baobab+ and Yellow, both offering pay-to-own solar energy solutions, and solar industry leader Redavia, which designs and installs mobile solar farms for businesses and communities. Mechanisms such as the EEGF are addressing the issues in electrification in sub-Saharan Africa as mentioned in the recently published ‘Renewable Energy Market Analysis’ by IRENA and AfDB.