Small-scale renewable energy projects generate employment
‘Sustainable energy funds for Africa: Wooing investors for the financing of projects in Africa’ was the theme of a forum held on 27 May in Marrakech, Morocco, at the 48th Annual Meetings of the African Development Bank. For the panel of experts, the question was how to provide financing for projects that facilitate access to energy for the African masses, in particular, the poverty-stricken populations.
The panel examined the reasons why Africa’s small-scale renewable energy projects are facing financing difficulties. The answers it found were that banks and investors were reluctant to finance these projects because returns could only be realized in the long term and that they also carried a high risk. The continent also lacked the financial expertise to manage these investments. Doubts about the profitability of clean and renewable energy projects also continued linger.
Members of the panel proceeded with a number of proposals, citing a number of examples from the continent. Solomon Asamoah of the Africa Finance Corporation said in Nigeria, a corporate entity provided project initiators with the necessary financial arrangements and feasibility studies, making financing for such projects easier to obtain.
Sierra Leone’s Minister of Energy, Olunivi Robbin-Coker, said the practice in his country was to stimulate job creation through renewable energy projects by establishing partnerships between the public and private sectors. These projects made possible the delivery of services including schools and infrastructure.
Africa’s main promoter of financing for renewable energy projects is the Sustainable Energy Fund for Africa (SEFA) at the AfDB. SEFA provides technical assistance and acts as a catalyst for investments in Africa’s sustainable energy sector. It aims at improving the continent’s access to modern forms of energy and stimulating employment and growth.