The AfricaGoGreen Fund (AGGF) has secured $47 million in a second funding round.
The funding will allow AGGF to broaden its financing for climate-friendly projects in Africa, including purchasing high-efficiency appliances and industrial equipment and retrofitting existing buildings and new green buildings.
Also, other projects like installing rooftop solar and battery storage for residential, commercial, and industrial consumers will be covered.
The funding round was led by the International Finance Corporation (IFC), the African Development Bank (AfDB), the Nordic Development Fund (NDF) and the Sustainable Energy Fund for Africa (SEFA).
IFC provided $17 million in equity, which includes financing from the IDA20 Private Sector Window Blended Finance Facility.
In addition to equity, IFC committed $30 million in debt to the fund, providing AGGF with long-term capital to complete the second close fundraise.
The African Development Bank, the Nordic Development Fund, and the Sustainable Energy Fund for Africa each invested $10 million in equity. An additional $10 million in debt from Calvert Impact Capital was closed in December 2022.
AGGF was Launched by kfW, a private banking company on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ) in early 2021 and managed by LHGP Asset Management.
The start-up is the first structured debt fund in Africa focused on energy efficiency solutions.
“The fund targets reaching between $230 million and $250 million at final close. With the current fundraising round, total funding stands at $138 million, demonstrating that the fund is getting traction to reach its full scale,” stated the firm.
AGGF is accompanied by a technical assistance facility of $3.3 million from KFW on behalf of BMZ, which supports project development and market studies, and provides transaction advisory and capacity building to stakeholders.
The firm has provided financing to AktivCo, a telecom energy services company, to develop clean energy solutions for powering telecommunication towers in Burkina Faso, Cameroon, Chad, Côte d’Ivoire and Niger, and to BBOXX, a pay-as-you-go solar-powered solutions provider, to accelerate access to clean cooking solutions for millions of Africans.
AfricaGoGreen Fund has also more recently closed the Solarise transaction investing in energy-efficient appliances in Kenya, South Africa and Mauritius, and upsized both the AktivCo and BBOXX transactions.