By Faridat Salifu
The International Finance Corporation (IFC) and Social Investment Managers and Advisors (SIMA) have successfully closed a $150 million solar green bond initiative.
This innovative financing effort aims to drive productive solar energy projects in sub-Saharan Africa.
Reports say IFC has contributed $45 million to the initiative, including a $25 million loan and subordinated loans totaling $11 million from the Finland-IFC blended climate finance program. We gathered that further support comes in the form of a $9 million backing from the Global Energy Alliance for People and Planet (GEAPP).
The remaining $131 million in financing is being provided in the form of loans by various entities, such as the U.S. International Development Finance Corporation (DFC) and the Austrian Development Bank (OeEB).
The funds raised will be directed towards one of the largest impact funds focusing on rooftop solar energy development in Africa, particularly targeting small and medium-sized enterprises.
This initiative aims to support local developers through short-term corporate finance and project finance, with a focus on sectors like manufacturing, services, education, healthcare, and agribusiness.
Expected to finance over 220 MW of solar energy and electricity storage projects, this partnership between IFC and SIMA is set to have significant environmental impacts.
The projects financed are projected to result in energy savings, improved value chains, and substantial reductions in fossil fuel consumption and CO2 emissions over the assets’ lifetime, amounting to around 4 million tonnes.
