Nigeria and the rest of Africa might benefit from a $500 million Gigaton Empowerment Fund designed to scale financing to increase climate action and energy access.
The fund, established by SunFunder, a private debt management company that finances renewable energy projects in Africa and Asia, has been shortlisted by the United Nations-convened Net-Zero Asset Owner Alliance, a group of over 60 institutional investors representing $10 trillion Assets under management (AUM).
The fund will make more than 130 clean energy investments, improving energy access for over 10 million people while reducing more than 18 million tonnes of CO2e.
Founded 10 years ago as a crowdfunding platform, SunFunder has launched a series of innovative blended finance investment vehicles and closed over $165million in investments across 58 companies deploying clean energy mainly in Africa and Asia, such as off-grid solar home systems in Malawi, village mini-grid projects in Kenya, and commercial and industrial rooftop installations in Nigeria and Thailand.
The investments mitigate carbon emissions by replacing fossil fuels, and also help communities adapt to climate change by increasing resilience in economies and food systems.
In a statement, the United States’ International Development Finance Corporation (DFC) has approved a $100 million debt investment in the Gigaton Empowerment Fund to finance distributed clean energy transition companies and projects, primarily SMEs in Africa and Asia, and to build climate-friendly solutions in response to increasing demand for energy in developing countries.
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Also, European Investment Bank (EIB) European Investment Bank (EIB) has US$50million in financing under appraisal for Gigaton focus on small and medium-sized enterprises in the areas of distributed solar, storage and energy efficiency, targeting African, Caribbean and Pacific states.
The fund falls in line with EIB’s climate action and environmental sustainability objectives.
This year, Mirova, an affiliate of Natixis Investment Managers, Swish Company dedicated to impact investing announced acquisition of SunFunder. Mirova acquired 100 per cent of the equity of SunFunder on June 3.
Mirova is expanding its investment platform in emerging markets. This is a major step in Mirova’s development strategy in real assets.
SunFunder has helped improve access to solar energy for more than ten million people, predominantly in East and West Africa, before extending its expertise to other emerging markets, including Southeast Asia.
Mirova and its subsidiaries manage €billion of assets as of March 31, this year, including €2.2billion in energy transition infrastructure and €500million in natural capital.