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AfrElec: Green Climate Fund invests $150mn in Desert to Power

The Green Climate Fund (GCF) has invested $150mn in the African Development Bank’s (AfDB) Desert to Power G5 Financing Facility.

Desert-to-Power is a flagship renewable energy and economic development initiative led by the AfDB that aims to light up and power the Sahel region by building 10 GW of PV generating capacity at public, private, grid and off-grid projects by 2030.

The objective of the umbrella Desert to Power G5 Financing Facility is to assist the G5 Sahel countries – Burkina Faso, Chad, Mali, Mauritania and Niger – to adopt a low emission power generation path by making use of the region’s abundant solar potential.

It will mobilise $966mn over a seven-year implementation period. The initiative is expected to lead to substantial CO2 emission reductions – projected at over 14.4mn tCO2equ.

The facility consists of both public and private sector sub-projects, which will be implemented under three components: The first entails grid investments and investments in storage solutions to de-risk solar IPPs and pave the way for the uptake of a regional solar market.

The second component entails the provision of concessional finance and guarantees for new solar independent power producer (IPP) plants to add over 500 MW of solar energy generation capacity. The third component involves technical assistance to support the creation of a clear and predictable environment for private sector solar investments and the development of an adequate capacity of national institutions in the G5 Sahel countries.

“The Desert to Power G5 Sahel Facility is a significant shot in the arm for the Desert to Power initiative. It will spur private sector investments in developing solar generation capacity in the G5 Sahel countries. This will provide an opportunity to realise Dr Adesina’s and by extension the African Development Bank’s vision of the Desert to Power initiative as an integral part of the solution for tackling climate change in the Sahel. The timing of the approval is also perfect, coming just before COP26,” said AfDB vice president Kevin Kariuki.

The Green Climate Fund is a fund established within the framework of the UNFCCC as an operating entity of the Financial Mechanism to assist developing countries in adaptation and mitigation practices to counter climate change.

Reacting to the approval, GCF Deputy Executive Director Javier Manzanares said: “We are proud to be part of this innovative project with our partners at the African Development Bank. The Desert to Power G5 Sahel Facility has the potential to make an enormous difference in people’s lives across the Sahel by tapping into the immense potential of solar energy, generating cheaper, reliable and low-emission electricity. GCF’s catalytic financing alongside that of the African Development Bank and the private sector will together mobilise nearly $1bn for this truly transformative project.”