With a $30 Million investment for Sub-Saharan Africa, Green Climate Fund joins a coalition of investors and donors to protect the progress made in achieving universal energy access.
This week, the board of the Green Climate Fund (GCF) approved a $30 million investment in the Energy Access Relief Facility, a fund to support off-grid energy companies through the COVID-19 pandemic. As a pioneer in the off-grid energy access sector, Acumen helped catalyze a global alliance of investors and donors to make this fund a reality. This support from GCF marks a major milestone in this critical effort to sustain the sector.
Over the last decade, off-grid energy companies have delivered clean, renewable, affordable power to 470 million people. The pandemic-induced economic crisis has shaken these companies’ foundations, putting their progress at risk and thereby threatening off-grid households’ access to electricity—as well as the potential access for the 770 million still waiting for energy. The crisis also threatens the ability of the sector as a whole to achieve SDG7—universal clean energy access—and the many other SDGs that depend on energy access.
Since March, Acumen, a longstanding partner of GCF, has helped galvanize a sector-wide coalition of investors, donors, and advisors to respond to COVID-19’s effects on this industry and protect the progress of energy access enterprises in sub-Saharan Africa and South Asia. The energy access sector has seen demand and turnover decline, staff layoffs increase, and business closures hit nearly a third of the market. As the second wave of COVID-19 cases advances, there seems to be no end in sight for these young businesses struggling to serve their customers and keep the lights on.
Through its partnership with Acumen, GCF’s investment will anchor the Energy Access Relief Facility, a targeted $100 million concessional debt facility that blends philanthropic and investment capital to offer low-interest loans to cover companies’ short-term liquidity needs. The goal of the Energy Access Relief Facility, managed by SIMA Funds, is to both maintain existing off-grid energy services and life-saving jobs that will be required if there is to be a future for the energy access sector.
Acumen has been investing towards bringing off-grid energy to low-income people since 2007. And we won’t stop now. We cannot stand by to watch these companies’ progress and impact deteriorate in the wake of a global crisis. Instead, Acumen stands undeterred with a hard-edged hope. In this pivotal moment of crisis, it is the responsibility and the privilege of those committed to the sector to act. Over the course of the last nine months, we have been consistently inspired by the way the many players in this sector have rallied together to do so. Working hand-in-hand around the globe, at all hours and for weeks on end, this collaborative effort—unlike anything we’ve seen before—to develop this facility was born with the companies and their customers in mind. Acumen could not be more excited to partner with GCF in taking this great leap forward on the journey to energy access for all.