Sustainable Energy Fund for Africa

Background:

The Sustainable Energy Fund for Africa (SEFA) is a multi-donor Special Fund managed by the African Development Bank. It provides catalytic finance to unlock private sector investments in renewable energy and energy efficiency. SEFA offers technical assistance and concessional finance instruments to remove market barriers, build a more robust pipeline of projects and improve the risk-return profile of individual investments. The Fund’s overarching goal is to contribute to universal access to affordable, reliable, sustainable, and modern energy services for all in Africa, in line with the New Deal on Energy for Africa and Sustainable Development Goal 7.

Established in 2011 in partnership with the government of Denmark, SEFA has since received contributions from the governments of the United States, United Kingdom, Italy, Norway, Spain, Sweden, and Germany, and also from the Nordic Development Fund and the Global Energy Alliance from the People and Planet.

SEFA is housed in the Renewable Energy and Energy Efficiency Department (PERN) under the Power, Energy, Climate, and Green Growth (PEVP) complex.

Notable achievements:

SEFA has spearheaded the African Development Bank’s engagement in green mini-grids, through the Market Development Program and country-focused support to create an enabling investment environment. Through these initiatives, SEFA has paved the way for the Bank to finance its first two scale-up green energy programs in the Democratic Republic of Congo and Burkina Faso.

SEFA also develops flagship blended-finance initiatives in the sector. It played a catalytic role in the preparation and financial close of the Africa Renewable Energy Fund (AREF) – one of the first pan-African equity funds in the market. It also played a key role in establishing the Facility for Energy Inclusion (FEI) – a debt financing platform for small-scale renewables across the continent.

Scope:

SEFA supports interventions across three strategic priorities:

Green baseload: Increasing the penetration of renewable energy in power systems, with a strong focus on power system stability, and delivering alternatives to fossil-fuel baseload generation options.

Green mini-grids: Accelerating electricity access to underserved populations through clean energy mini-grid solutions.

Energy efficiency: Improving the efficiency of energy services delivered through a variety of technologies and business models, also including clean cooking and pico-solar technologies.

Instruments:

Technical assistance: Support through grants with a strong focus on activities that will directly unlock investments. Technical assistance grants are available to public and private sector entities.

Concessional investment: Support through results-based financing, loans, and equity instruments, often blended with African Development Bank investments to close viability gaps.