Johannesburg, South Africa, May 20, 2013
– IFC, a member of the World Bank Group, today announced an agreement
with Oesterreichische Entwicklungsbank (OeEB), the Development Bank of
Austria to increase sustainable energy investment in Sub-Saharan Africa,
starting with Kenya, Tanzania, Uganda and Rwanda. OeEB agreed to contribute
€2 million to support project development, capacity building and assistance
to financial institutions under the Africa Sustainable Energy Facility.
The facility is a joint program by IFC and the European Investment Bank
(EIB) to increase investments in renewable energy and energy efficiency.
Both institutions are contributing equally to the €60 million financing
facility while OeEB alongside EIB is providing additional funds for a support
unit that will identify and facilitate investments. The facility will also
include a South-South technology exchange between private sector players
which will be managed by the World Bank Institute.
The facility has already identified a preliminary number of investment
opportunities, including in small hydro projects, solar photovoltaic installations,
solar lanterns and local energy service companies that can provide a demonstration
effect for further projects.
Michael Wancata, member of the executive board of OeEB, said, “Improving
access to modern infrastructure and supporting the supply of clean energy
are two key areas of our work. This facility will help to address various
market barriers while providing a significant amount of financing.”
The lack of access to modern and reliable forms of energy is impeding the
development of economic opportunities, especially for low-income households.
Energy prices in the region are relatively high which makes renewable energy
and energy efficiency commercially viable. In addition, given that access
to electricity is limited, renewable energy is an attractive option for
providing energy to off-grid users.
However, economically viable sustainable energy projects are currently
struggling to obtain adequate financing due to the lack of available financing
for smaller projects, perceived risk by potential investors, lack of sufficient
credit worthiness and the need for compliance with comprehensive technical
and legal requirements.
David Crush, IFC Manager for Access to Finance Advisory Services in Sub-Saharan
Africa, said, “Climate change is one of our key strategic priorities.
By strengthening sustainable energy providers and developing projects,
we aim to increase sustainable energy investments and demonstrate their
viability to local financial institutions. This program is also an excellent
example of cooperation between development finance institutions leveraging
the expertise and resources of IFC, OeEB and EIB.”
IFC, a member of the World Bank Group, is the largest global development
institution focused exclusively on the private sector. We help developing
countries achieve sustainable growth by financing investment, mobilizing
capital in international financial markets, and providing advisory services
to businesses and governments. In FY12, our investments reached an all-time
high of more than $20 billion, leveraging the power of the private sector
to create jobs, spark innovation, and tackle the world’s most pressing
development challenges. For more information, visit www.ifc.org.
Oesterreichische Entwicklungsbank AG (OeEB) has been operating as the official
Development Bank of Austria since March 2008. It specializes in the provision
of long-term finance for the implementation of private sector projects
in developing countries which create sustainable development. Additionally,
OeEB provides technical assistance (which can be used to enhance the developmental
impact of projects. For more information, please visit www.oe-eb.at.