Infrastructure PIDG can take the lead, demonstrating that investment in infrastructure in lower income countries can be viable and the risk profile may not always be as high as perceived. Green Power Africa is the latest PIDG facility to be established Open for business in November 2014, it is a mezzanine-financing fund. It is designed to address key market failures in the power sector to stimulate private sector investment in renewable energy by reducing the overall cost of capital for energy generation projects, maintaining commercial returns.
environments and greater scrutiny of aid spending. Consequently, there is a growing interest in contributions private sector enterprise can make to poverty alleviation and an understanding that there is a need to further leverage the existing sources of finance (official or commercial) with alternative sources of debt and equity.
GAP has an ambitious target to finance 240MW of renewable energy generation capacity, saving 9 million tonnes of carbon emissions and improving the supply of clean energy to millions in sub-Saharan Africa. Through selected investments, GAP will demonstrate the economic viability and technical feasibility of new technologies and encourage investment by private investors in sustainable business models and economies of Africa.
PIDG is uniquely placed to build on its successful track record, engaging the private sector, mobilizing and delivering sustainable commercial returns on investments in some of the poorest countries in the world, securing measurable poverty reduction, and economic growth.
The need for targeted funds has increased in recent years. International Financing Institutions (IFI) face capital constraints and commercial banks are below precrisis levels as they deal with weak balance sheets and regulator pressure to avoid or limit long-term structured finance. Traditional donor also experiencing 40
governments are constrained fiscal
Corporate Africa 2015
The continued need for significant infrastructure provision investment requires the pursuit of alternative sources of capital including private equity funds, sovereign wealth funds, social impact, and local investors. Currently, new players are looking to enter the market but not necessarily at the frontier.
PIDG can take the lead, demonstrating that investment in infrastructure in lower income countries can be viable
and the risk profile may not always be as high as perceived. It often can be managed through risk mitigating measures. PIDG and its funding members remain committed to tackling poverty by mobilizing private investments for vital infrastructure. Securing that infrastructure remains key to sustainable prosperity and economic progress for Africa. â–
Reliable and cost-effective supplies of energy will be essential for countries across Africa to participate and benefit from increase trade and economic growth.
PIDG has published a case study on one of its Facilities, InfraCo Africa, which elaborates on the partnership with Cenpower Holdings to develop a 350MW Combine Cycle Gas Turbine Plant in Ghana: The Kpone Independent Power Plant (KIPP). The case study has since been recognized as the most outstanding African power deal of 2014 and is available to read on the Corporate Africa website: www.corporate-africa.com