Private sector crowdsourcing origination platform is opening doors for Africa’s power projects.
Africa’s rich energy resources have opened the door to an abundance of power projects across the continent, specifically in the renewable energy sector. Billions of dollars have also been made available for these projects with the hope of transforming the power sector and wider economy. However, the continent still faces an energy deficit.
So what stands in the way of bringing these projects to fruition? A shortage in resources and experienced project developers who are willing to take on early stage project risks, as well as transform sound concepts into bankable projects. This is according to Access Power, a developer, owner and operator of power assets in emerging markets.
To help bridge the gap between local project developers and originators, as well as the experience and funding required to bring these projects to life, Access Power has designed an innovative platform called the Access Co-Development Facility (ACF) which is now in its third round. This year aims to build on the success of previous rounds in 2015 and 2016 which saw a total of five projects being awarded and three Joint Development Agreements signed.
The aim of ACF is to identify early stage projects with a strong foundation and provide the resources and support required to reach bankability and financial close.
To make the project management process easier for these applicants, the company has pulled the technical and financial resources under one umbrella.
Ana Parker, Manager, Corporate Communications ACF, says of the initiative: “The ACF was originally inspired by our firm belief that Africa’s power sector and wider economy can be transformed given that funding is readily available. However, funding on its own cannot have an impact without well-resourced and experienced developers willing to take early-stage development risk and have the ability to turn good concepts into bankable projects. As such, investment in the early stage development of power projects forms the cornerstone for the realization of Africa’s growth potential.”
Launched in April 2015, the ACF acts as a financial and technical support mechanism designed to provide local project developers and originators in Africa with the technical expertise and funding required to bring their renewable energy projects to fruition.
According to Access Power, the ACF is at the forefront of an exciting new concept as the first private sector-driven crowdsourcing origination platform for power projects in Africa.
Access Power works closely with international partners that participate in the selection process of the winning projects, in the past years those partners included: African Development Bank, FMO, IFC, Proparco, and InfraCo Africa.
The first round of ACF received 55 applications from 18 African countries. The following projects were selected to enter into Joint Development Agreement discussions:
Quaint Solar Energy (50MW solar PV in Nigeria)
Flatbush Solar (20MW solar fixed ground mount PV in Cameroon)
The Quaint Solar Energy project has turned into a great success story as it rapidly obtained requisite license and permits and has proceeded to execute a Power Purchase Agreement (PPA) with the Nigerian Government. The project is expected to reach financial closure by the end of 2017.
During the second round in 2016, US$7 million was made available and ACF received 96 applications from 25 countries, covering several renewable energy technologies. Following a live judging session, the following three projects were selected:
Stucky Ltd (25MW hydro/solar project in Madagascar)
AGES PLC (25MW solar project in Sierra Leone)
Mentach Energy (50MW wind project in Nigeria)
Menatech Energy and Stucky Ltd are now in the process of working to secure PPAs with the respective governmental entities for their projects.
Now, round three promises to be extremely exciting as Access Power offers project developers a chance to pitch their renewable energy projects to a panel of specialists at the Africa Energy Forum in Copenhagen on 7 June 2017. The panel includes experts from Power Africa, InfraCo Africa, Proparco and the Dutch Development Bank (FMO) and they will be providing Access Power with recommendations on the commercial, technical, social and environmental viability of each project based on a host of market, regulatory, environmental and economic factors.
The applicants stand the chance of winning a share of the US$7 million for project development. The funds will be set aside for third party development costs of the winning projects. Historically the requested development funding for each of the projects ranges from $1.2 to $1.5 million hence the $7 million funds will be able to sufficiently catalyze up to three winning projects.Added to this, the winning project developers will receive a technical support package from Access Power’s experienced and specialised team of project developers.
Submissions are now open, download your application here. Deadline for submissions is 8 May 2017.