African renewable energy fund hits $200m mark
The African Renewable Energy Fund (AREF) has hit its fundraising target of $200 million (about N38 billion), which it plans to use for investing in grid-tied renewables in sub-Saharan Africa (excluding South Africa).
This is coming as the World Renewable Energy Network, declared that renewable energy presently contributes only 11 per cent to primary energy across the globe.
The Nairobi-based AREF, which is managed by Berkeley Energy, plans to add 200Mega Watt (MW) and 250MW of electric generating capacity in the region.
This generating capacity is expected to come in form of solar, hydro, wind, geothermal and biomass projects and developments, estimated to gulp in between $10 million and $30 million.
The largest investor in AREF is the African Development Bank (AfDB) which has invested $55 million in the AREF project. The African Development Bank has also made climate finance tools such as Sustainable Energy for Africa and the Global Enviroment Facility (GEF) available for use. The hope is that this investment will encourage other commercial and institutional investors.
Sustainable Energy for Africa has also committed to provide a Project Support Facility worth $10 million. This support facility will be deployed at an early stage and will provide resources to projects looking to create profitable deals.
Commenting on the development, a director of AfDB, Alex Rugamba, said: “African Development Bank is pleased to see that AREF is now fully capitalised to deliver on its pan-African mandate. We are also equally excited that Sustainable Energy for Africa (SEFA) and GEF participation have been catalytic in mobilising significant amounts of commercial capital into AREF over a short time-frame; this is key for accelerating deployment of modern, clean and affordable energy in the continent.”
Next week, Cape Town will play host to the sixth International Renewable Energy Conference, where the subject of alternative power supply in Africa will be the theme of discussion.
Meanwhile, World Renewable Energy Network said it expected that 60 per cent of global energy will come from renewable energy by the year 2070.
“The world population in the year 2100 will be in excess of 12 billion. If the current trends in technological progress and innovation continue, the demand for energy then will be five times greater than what it is now.
“If we continue the policy of using coal, oil and gas at the present rate, then by the year 2020 the global temperature will have increased by two degrees Celsius. We do not need reminding of the adverse effects of this: the increased risk of flooding in lowland areas, the processes of desertification, and changing climate all over the world.
“It is a known fact that at the present moment renewable energy contributes only 11 per cent to our primary energy. If we intend to do something about our planet, to safeguard our future and to create a healthy environment for the generations to come, then we must all actively utilize renewable energy in our daily life.
“It is expected that 60 per cent of all our energy will come from renewable energy by the year 2070. The sooner we employ the attitude that today is better than tomorrow, the greater the opportunity to increase this figure to 80 per cent,”