Engaging the private sector in sustainable energy finance

22 mai 2012

European Union

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Table of content

1. Context in East Africa

2. What is SUNREF?

3. Objective of SUNREF

4. Structure of the program

5. Achievments

Context in East Africa

Each of the three East African focused countries (Kenya, Uganda and Tanzania) forecasts for 2016 show an average growing for energy demand of 10% which will require the construction of new fossil fuels means;

Such trends in the region will have a significant impact on the need for new generation capacities and power bill, and on the regional increase in use of petroleum products to generate power;

Kenya’s contribution to climate change will increase significantly if the country does not start its transition process towards renewable energies. Therefore, the support to Region’s transition process towards renewable energy sources is essential;

In this context, in 2010, AFD has launched a regional SUNREF (Sustainable Use of Natural Resources and Energy Finance) programme for East Africa, consisting of a Technical assistance and Credit Facilities to the banks of the Region.

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What is SUNREF?

SUNREF (Sustainable Use of Natural Resources and Energy Finance) has been designed to help businesses in the East Africa seize the opportunities created by the ecological transition;

The innovation of the SUNREF product lies in the combination of a financial approach and technical approach;

SUNREF East Africa comprises specific and innovative financial and technical products: Credit lines provided by AFD to partner commercial banks in East Africa; A program of technical assistance to help:

Identify investment opportunities in energy efficiency and renewable energies Advise investors as they develop their project and check investment eligibility Monitor the implementation of their projects the banks market, communicate and promote the financial offers available under the credit

line Capacity building for all the stakeholders

The technical assistance expertise is financed by the European Union, so is free of charge to investors and banks.

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Renewable EnergyRenewable EnergyEnergy EfficiencyEnergy Efficiency

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What is SUNREF?Targeting green growth through projects in two key sectors

Local Banks Projects Sponsors

Low interest rates / Long tenure / Grace Period / Euros, Dollar & local currency

What is SUNREF?The green credit line provides tailored-made debt

Objectives of SUNREFResults & impacts worldwide

To strengthen and to structure local public or private financial insitutions;

To decline a sustainable energy public policy towards final beneficiaries that AFD cannot finance directly;

To assist financial institutions to finance innovative projects on immature markets;

To extend access to financing for the sponsors and strengthen the competitiveness and awarness of private sector.

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with 70 experts (local and international ones)

Structure of the program in East Africa

Project origination / Capacity Building / Project bankability / Raising awareness

Kenya

3 partner banks11 projects financed

Pipeline of other 20 certified projects

Tanzania

1 partner bankPipeline of 2 certified projects

Uganda

1 partner bank

Achievments

42 M$ disbursed by SUNREF for 58M$ of green investment

Cross sector: mini-hydro, PV, biomass, biogas, ESCO, Energy Efficiency

Training given to 35 people, 4 banks

Start of an ESCO providing energy savings to 11 industrial clients to date

Policy advocacy: standard PPA and net-metering policies

Achievments

Example : Kenya Tea Development Agency (KTDA)

Year 2014 Total amount USD 15,497,000 Loan amount USD 10,847,000 Renewable energy generated: 25.32 GW hr/y Emissions savings: 16,000 t eq CO2/y

Example : Meru Central Diaries Year 2014 Total amount USD 3,3 MILLION Loan amount USD 2,3 MILLION Cost savings: $262,400/y Emissions savings: 532 t eq CO2/y

Example : Strathmore University Year 2015 Total amount USD 1,3 million Emission Savings: 800 t eq

CO2/year Energy Capacity: 0.6 MW

Example : Lean Energy Solutions Year2015 Total amount USD 1,000,000 Energy savings: 35% Emissions savings: 8843 t eq CO2/y Overall cost savings: $0,5 M

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Thank you for your attention

22 mai 2012

https://www.sunref.org