Public sector support for early stage
renewable energy project development in sub-Saharan Africa
To achieve the ambitious international clean energy, energy access and climate goals (SEforAll, AEEP, UNFCCC), current levels of investment will need to increase. It is widely agreed that private investment is required to complement public resources if these ambitious goals are to be achieved. However, there appears to be a shortage of viable clean energy investment projects in sub-Saharan Africa which are ready to attract financing.
Strategic public sector support in the early and risky stages of project development could therefore play an important role in boosting project pipelines and thus support emerging African renewable energy markets.
In Brussels, on 16/2/2017, the Climate Change Service of the Belgian Federal Ministry of the Environment and the Africa EU Renewable Energy Cooperation Programme (RECP) brought together 35 private sector project developers, representatives of existing early stage support initiatives, Development Finance Institutions and donors in a Round Table to discuss, under Chatham House Rules, options for such public sector interventions.
For the purpose of this roundtable “early-stage” was defined as the stages before active project development. The market segments to which this support should be targeted are smaller on-grid systems and off-grids systems (mini-grids and standalone systems).
The discussions during the one-day event, moderated by Mike Enskat (GIZ), were fed by short presentations (see below) summarizing the real-life challenges in project development; lessons learned from existing facilities; and an overview of identified public support options. The participants exchanged views and ideas in break-out sessions, based on the three models identified, i.e. technical assistance, finance and development models, and in a concluding plenary.
Setting the scene:
- Renewable Energy in the Paris Agreement – Patricia Grobben, Belgian Climate Change Service
- Context and focus of the Roundtable – Michael Franz, RECP
Real-life challenges faced by early-stage project support:
- ElectriFI – the Electrification Financing Initiative - Maaike Gobel, ElectriFI
- Experience by BIO, the Belgian Investment Company for Developing Countries – Anne Berger, BIO Invest
- Energy & Environment Partnership challenges – Henri Horn, Ministry Foreign Affairs, Finland
- Private sector perspective – Andreas Spiess, Solarkiosk
Stocktake of existing facilities: lessons learned – Adriaan Tas, Carbon Africa
Systematic overview of public support options for early stage project development – Alan Follmar, Intervenance