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Sub-Saharan Africa

Region Overview

 

Africa needs at least USD 2.5 trillion (74% of the continent’s USD 3.4 trillion GDP in 2021) or USD 250 billion annually in conditional and unconditional financing between 2020 and 2030 to implement its NDCs under the Paris Climate Agreement [1]. However, current reported annual climate finance inflows to the continent amount to USD 30 billion (equivalent to only 12% of conservative annual required flows), leaving a significant financing gap.

The investment needed, in the clean energy sector alone, to meet the continent’s energy and climate goals between 2026 and 2030 amounts to USD 133 billion annually [2]. However, annual investment in renewable energy – arguably the most attractive sector for commercial investors – stands at a mere USD 9.4 billion. Part of the challenge limiting the flow of climate finance to and in Africa is the real and perceived risks that reduce investor appetite to expand investment on the continent. These risks include currency instability, regulatory and governance problems, lack of bankable project pipelines, limited awareness and lack of technical capacity, transparency and accountability mechanisms.

It is within this context that PFAN aims to play a catalytic role in mobilizing more capital to meeting Africa’s climate finance needs by (1) helping entrepreneurs and project developers prepare and present sound investment propositions, (2) connecting investors to high-quality projects and business and (3), in the process, mitigating some of the challenges and risks investors face in building a good pipeline of projects in Africa.

 

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Finance mobilised and new projects supported

In 2022, we supported 13 projects in sub-Saharan Africa to mobilise finance and raise a total investment of USD 35.9 million, including BioMassters, which develops clean cooking stoves in Rwanda, Bio-Innovations which creates energy from waste products in Uganda and All in Trade which supplies PV solar, also in Uganda.

Despite the myriad of challenges facing sub-Saharan Africa, East Africa was the continent’s most successful region for PFAN in 2022, with 9 PFAN-supported businesses raising investment. In Southern Africa, a project secured USD 32 million to build a hydroelectric dam in Madagascar, which will provide significant benefits to the community, and women in particular.

In Eastern Africa we added 19 new projects to the pipeline in Kenya (5), Tanzania (5), Uganda (5), Ethiopia (2) and Rwanda (2) in the areas of adaptation, biomass, clean transport, energy efficiency and demand reduction, rural electrification and energy access, solar and waste to energy.

In Southern Africa we added 23 new projects to the pipeline in Zambia (8), Madagascar (7), South Africa (2) and (1) each in Botswana, the Democratic Republic of the Congo, Lesotho, Malawi, Mozambique and Zimbabwe in the areas of adaptation, biofuels, biogas, biomass, hydro, rural electrification and energy access, solar and waste to energy.

In Western Africa we added 16 new projects to the pipeline in Ghana (4), Togo (3), Benin (2), Nigeria (2), Senegal (2) and one each in Burkina Faso, Cote d’Ivoire and Sierra Leone in the areas of adaptation, biofuels, biomass, clean transport, energy efficiency and demand reduction, rural electrification and energy access, solar and waste to energy.

 

‘In the next year, PFAN will go on to invest in enhancing our investment facilitation services. This is informed by the greater needs and challenges faced by projects and businesses in raising capital in the African markets. Hopefully, this will result in greater financial mobilization, enabling more entrepreneurs to achieve their business goals while contributing to positive climate action.’

Wilfred Mworia, Regional Coordinator for Sub-Saharan Africa

 

 

Events and regional initiatives

At COP27 in Sharm-El-Sheikh, PFAN organized an adaptation-themed side event where we showcased three adaptation projects from Ghana, Kenya and Tanzania. We further collaborated with the African Development Bank on the 2022 AfDB Agripitch Competition, which invited young African agripreneurs to compete for USD 140,000 to advance their business ideas. In our role as Knowledge Partner, our Advisors acted as business coaches for the selected projects and specifically contributed significantly to capacitating entrepreneurs on aspects of gender inclusivity in their business models.

At the beginning of the year, PFAN ventured into digital engagement as a way to reach investors through the launch of our online Deal Book. The pilot project compiled 21 projects on our website and generated significant interest, paving the way to build further on this experience by expanding its geographical scope and number of projects in 2023. As mentioned above, securing private capital for climate projects in Africa is relatively more complicated and time-consuming than in other regions. Initiatives like the PFAN Deal book aim to help to increase the visibility of opportunities in sub-Saharan Africa and spark the interest of the investor community to invest in projects in a market with growing potential.

Furthermore, we initiated several activities in the region to attract an increasing number of women entrepreneurs and gender-responsive projects in the clean energy and climate adaptation space, including a webinar in collaboration with the World University Service of Canada (WUSC) on supporting women climate entrepreneurs in sub-Saharan Africa as well as social media campaign which highlighted our Gender Focal Points and female advisors in the region.

 

Umoja Incubator

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Together with Serengeti Energy, PFAN launched the Umoja Incubator in September 2022 to equip renewable energy entrepreneurs in sub-Saharan Africa with the commercial and technical knowledge to help them mobilise investment and positively impact their communities. The collaboration paired Serengeti Energy’s early-stage development finance capabilities and experience with PFAN’s expertise in project origination and preparation. We encouraged applications from clean energy entrepreneurs from across the continent, which were evaluated by our jury of experts from the renewable energy field.


We invited the 13 shortlisted projects from Namibia, Ghana, Kenya, Zambia, South Africa, Zimbabwe, Benin and Uganda to Cape Town, South Africa to participate in a week-long workshop of expert training, networking sessions and capacity building. After pitching to the jury and investors present, a 20 MW solar project from Benin was announced as the winner of the first Umoja Incubator.

Find out more

Sub-Saharan Africa in 2022

  • 35.9 Total investment leveraged (USD million)
  • 13 Projects which mobilised finance
  • 58 New projects which received PFAN support
  • 81 Total Advisors in the region
  • 17 Female Advisors in the region
  • 94% Locally-based Advisors
  • 13 Clean energy capacity added by projects which mobilised finance (MW)
  • 6 New partnerships established
New PFAN-supported projects by country – Eastern Africa
    New PFAN-supported projects by technology – Eastern Africa
    New PFAN-supported projects by country – Southern Africa
      New PFAN-supported projects by technology – Southern Africa
      New PFAN-supported projects by country – Western Africa
        New PFAN-supported projects by technology – Western Africa

        Advisor Spotlight

        Daniela Rakotomamonjy PFAN Advisor, Country Coordinator for Madagascar & Francophone SIDS

        Daniela Rakotomamonjy is a Country Coordinator and an Advisor for Madagascar, Mauritius, Seychelles, Maldives, and Comoros. She has a strong commitment to her country’s economic development, with an environmental engineering background and 16 years of experience in project development, business and entrepreneurship and degrees from HEC Paris in International Business Management and the University of Nevada in Business and Entrepreneurship.

        She is also the CEO of the ACE Group, specialising in the development of public and private partnership projects, renewable energy, agribusiness and farming, eco-lodge, and urban and rural land reform, among others.

        New Partnerships

        • Rocha Ghana (ARG)

          Rocha Ghana (ARG) is an environmental NGO providing practical conservation interventions aimed at contributing to the sustainable management of ecological habitats and initiating programmes aimed at facilitating the community’s ability to adapt to current trends in climate change.

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        • ACOPA-NGOd

          Action Communautaire Contre La Pauvrete (ACOPA-NGOd) is a non-governmental organisation with a vision to spearhead the socioeconomic prosperity of Congolese citizens by espousing poverty reduction, social inclusion and recovery programmes while building the capacity of people and institutions to ensure self-sustenance.

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        • Ghana Alliance for Clean Cookstoves (GHACCO)

          Ghana Alliance for Clean Cookstoves (GHACCO) is a national organization of the clean cooking industry with a mission to work with stakeholders to overcome the barriers that impede the production deployment and adoption and use of clean cookstoves, LPG and clean biofuels in Ghana.

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        • Groupe SOLIDIS

          A credible financial inclusion initiative in Madagascar, SOLIDIS is the only financial institution (non-bank) approved by the Central Bank of Madagascar that offers tailor-made guarantee and financing solutions to promote entrepreneurship and contribute to the country’s economic development.

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        • Serengeti Energy

          Founded in 2013, in Nairobi, Kenya, Serengeti Energy is an independent power producer IPP, with a mandate to identify, develop, invest, build, and operate renewable energy projects from 5MW to 50MW across sub-Saharan Africa. Previously known as rAREH, until October 2021, Serengeti Energy operated renewable energy assets in Uganda and Rwanda. The acquisition of South Africa based REH extended the company’s footprint into the South Africa market.

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        • SUNREF Madagascar

          SUNREF Madagascar is a green finance program aimed at promoting green investments from the private sector, through the combined deployment of an appropriate technical and financial offer.

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