The Board of Directors of the African Development Bank Group has approved an equity investment of up to US$25 million in ARCH Africa Renewable Power Fund (ARPF), a US$250 million private equity fund for renewable energy projects across Sub-Saharan Africa.

ARPF will provide equity for the development and construction of 10 to 15 greenfield renewable energy projects in Sub-Saharan Africa, adding approximately 533 MW of installed energy generation capacity from renewable sources in the region. This will provide both base load and peak load power in underserved markets.

ARPF projects will focus on mature technologies including wind, solar PV, small to medium hydro, geothermal and biomass. These would include grid-connected independent power producers (IPPs), and decentralized energy projects (commercial & industrial solar, mini-grids and solar home systems companies). The Fund’s strategy is to prioritize projects with a clear timeline to financial close, with emphasis on de-risking early stage greenfield projects.  

The Bank’s presence is expected to act as a catalyst for other investors to commit a further US$60-75 million equity from non-DFI sources. AfDB would also ensure that the highest environmental and social standards, together with climate change and gender considerations, are applied to the ARPF’s projects.

The Fund is expected to reach first close in early 2019. The ARPF anchor investing entity is ARCH Emerging Markets Partners Ltd, a London-based emerging market investment joint venture.