Renewable Energy Financing Solutions Regional Expert Meeting Climate Change and Enhanced Renewable Energy Deployment in East and Southern Africa Addis Ababa, Ethiopia 17-18 March 2016 Alec Joubert Investment Director, Energy Projects
Introduction to Camco Clean Energy Clean Energy Fund and Management Advisory Clean Energy and Climate Advisory Sub-Saharan Africa focus Offices South Africa (Johannesburg) East Africa (Nairobi, Kenya) Europe (London, UK) West Africa (Accra, Ghana) 2
Project Finance Challenges 3
The Project Development Life Cycle 4
Balancing Risk and Reward 5
Green Africa Power Private Infrastructure Development Group (PIDG) facility Offers quasi-equity debt and contingent lines of credit Total facility size: USD 200m www.greenafricapower.com Donors: UK Department for International Development (DFID) UK Department for Energy and Climate Change (DECC) Government of Norway Advisors Eiser Infrastructure Camco Clean Energy 6
GAP Key Issues/Barriers Well-advanced projects which are struggling to reach financial close Solutions: Mezzanine finance (subordinated debt, quasi-equity debt) and Contingent lines of credit Long tenors Funding not readily available from commercial markets 7
Mandate Least developed countries (DAC 1, 2, 3) Wide range of renewable energy technologies Utility-scale, grid-connected projects Later-stage project development support Attract private sector finance 8
Initiated by: Managed by: Funded by: www.repp-africa.org 9
REPP Key Issues/Barriers Limited sources of of development finance Limited commercial viability of small-scale renewable energy projects Levelised costs are not sustainable/equity returns are low Long-term debt Unavailable pricing high tenors too short Lack of access to risk mitigation instruments Lack of technical know-how amongst small-scale developers 10
REPP Mandate Small-scale renewables Least developed countries Nineteen target countries Wide range of renewable energy technologies Developer-focused Unlocking private sector finance 11
Products, Services and Solutions 1. Technical Assistance during Development Technical studies Legal and due diligence costs 2. Structuring Support Financial structuring Facilitating access to risk mitigation instruments Facilitating access to long-term debt 3. Results-Based Finance Results-based financial support to achieve commercial viability 12
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