African Development Bank Approves $5.65 Million to Pilot New Climate Finance Tool For Off-Grid Energy In Fragile States
ABIDJAN, Côte d’Ivoire, The African Development Bank Group has approved a $5.65 million reimbursable grant from its Sustainable Energy Fund for Africa to launch a first-of-its-kind climate finance mechanism aimed at accelerating off-grid renewable energy projects in Africa’s most fragile and underserved markets.
The funding will support the Peace Renewable Energy Certificate (P-REC) Aggregation Facility, an initiative designed to use renewable energy certificates as a direct financing tool for mini-grid developers operating in conflict-affected and energy-poor regions. The facility is co-financed by the Nordic Development Fund, which has matched the Bank’s contribution, bringing total funding to $11.3 million.
The facility will be managed by Camco Clean Energy in partnership with Energy Peace Partners, the developer of the P-REC standard. Under the model, renewable energy certificates generated by small-scale mini-grid projects will be sold to multinational corporations seeking to align sustainability spending with measurable social and environmental outcomes.
The mechanism will provide upfront payments to developers in exchange for future certificate rights, improving access to capital in markets where financing remains scarce. The facility will then sell the certificates to corporate buyers, generating hard-currency revenues for developers.
Projects supported by the initiative will span 14 countries, including Nigeria, Ethiopia, Democratic Republic of the Congo and Sudan, among others. The program is expected to deliver first-time electricity access to approximately 856,000 people through around 240,000 new connections and 71 megawatts of renewable energy capacity. About half of the beneficiaries are expected to be women.
The initiative aligns with Mission 300, a joint effort by the African Development Bank and the World Bank to connect 300 million Africans to electricity by 2030.
Bank officials said the facility addresses a critical financing gap for rural electrification in fragile states. By converting corporate demand for climate action into upfront capital, the mechanism is expected to unlock new private-sector investment in distributed renewable energy.
Partners involved in the project said the model could help scale clean energy access in high-risk environments, while delivering broader benefits such as improved livelihoods, job creation and enhanced social stability.
The African Development Bank Group, which operates across 54 member countries, said the initiative reflects its broader strategy to expand energy access and mobilize innovative financing solutions for sustainable development.
About the African Development Bank Group: The African Development Bank Group is Africa’s premier development finance institution. It comprises three distinct entities: the African Development Bank (AfDB), the African Development Fund (ADF) and the Nigeria Trust Fund (NTF). On the ground in 41 African countries with an external office in Japan, the Bank contributes to the economic development and the social progress of its 54 regional member states. For more information: www.AFDB.org
Contact: Frederica Lourenco | Communication and External Relations Department | Email: media@afdb.org
ABOUT SEFA: SEFA is a multi-donor Special Fund that 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 Mission 300.
ABOUT NDF: The Nordic Development Fund (NDF) is the joint Nordic international finance institution of the five Nordic countries: Denmark, Finland, Iceland, Norway, and Sweden. NDF focuses on the nexus between climate change and development in lower-income countries and countries in fragile situations. Since the introduction of the climate mandate in 2009, NDF has built a track record of adding value by financing climate mitigation and adaptation projects in close interaction with its extensive network of strategic partners.
ABOUT CAMCO: Camco is a climate and impact fund manager. With over 30 years’ experience in sustainable finance and on-the-ground value generation, Camco has supported over 200 projects in 29 countries. The company manages multiple investment platforms aimed at financing innovative solutions to address climate change and deliver positive impact in emerging markets, including the Renewable Energy Performance Platform (REPP), REPP 2, Spark Energy Services and TIDES, and is an Accredited Entity of the Green Climate Fund.
ABOUT ENERGY PEACE PARTNERS: Energy Peace Partners leverages climate and finance solutions to promote peace in the world’s most fragile regions. Our climate-sensitive approach expands the existing toolkit for peace and development by extending the renewable energy revolution to some of the planet’s most vulnerable populations. We address the intersection of energy poverty, conflict risk and climate vulnerability to demonstrate the peace dividends of clean energy.
