Clean and affordable off-grid energy
Over 600 million people in sub-Saharan Africa live today without access to electricity. For most of these people, connection to the grid is not likely to happen for decades, or longer. The Beyond the Grid Fund for Africa (BGFA) aims to reduce this gap by stimulating and accelerating the emergency of new business models to incentivise the private sector to offer affordable and clean energy access at scale to people living in rural and peri-urban areas. The programme builds on the positive experiences of the Beyond the Grid Fund for Zambia (BGFZ), which Sweden commenced in 2016 and which is successfully implemented by the Renewable Energy and Energy Efficiency Partnership (REEEP).
Beyond the Grid Fund for Africa forms part of the ‘Power Africa’ initiative launched by former President Barack Obama and contributes to the Sustainable Development Goal 7 as well as the Paris Agreement on Climate. The planned period of implementation is in total six years. The programme aims to benefit 5 to 15 million rural and peri-urban people in the participating countries.
Current funding programmes
BGFA has closed its third Call for Proposals (BGFA3) inviting interested off-grid energy companies to compete for funding with the aim of engaging them to develop new sustainable businesses and thereby accelerate access to affordable and clean off-grid energy at scale for customers in peri-urban and rural areas of Uganda. The total financing included under this third Call for Proposals is EUR 20.7 million, split into three Funding Lots. The indicative individual contract ticket size per company is expected to be EUR 1.2–4 million depending on the Lot.
The Pre-Qualification stage closed for applications on 22 June 2021. BGFA received 30 applications, of which 19 passed the internal completeness check. The applicants passing the review stage has been invited through the SmartMe online system on 14 September 2021 to take part in the Final Application stage and submit full project proposals. The Final Application stage is expected to be completed by February 2022.
BGFA3 is offering incentives to off-grid energy service providers that are expected to enable the establishment of up to 600,000 energy connections and benefit more than 3 million people in remote areas of Uganda. The plan is to have approximately 10 contracts signed by spring 2022, with project implementation starting in the same year. The BGFA3 funding is provided by the Danish and Swedish governments.
The Pre-Qualification stage for the second Call for Proposals for Mozambique (BGFA2) closed for new applications on 29 March 2021. BGFA received 17 applications, of which 10 passed the internal completeness check. Applicants passing the Pre-qualification stage are expected to be invited to the Final Application stage by end of 2021.
The expectation is that up to 42,000 off-grid energy service systems (ESSs) will be established during the project implementation period, thus benefiting more than 210,000 people in peri- urban and rural areas. The indicative individual contract ticket size is expected to be EUR 1.5 – 2 million. The energy services are to be implemented during a four-year period with total funding of EUR 6.7 million provided by the Swedish government.
Burkina Faso, Liberia and Zambia (BGFA1)
The Final Application stage for the first Call for Proposals (BGFA1), for Burkina Faso, Liberia and Zambia, has been finalised and applications passing the Final Application stage are currently in the due diligence review stage. First projects are expected to be contracted by end of 2021.
BGFA1 aims to incentivise off-grid energy companies to accelerate the establishment of new, long-term sustainable energy service subscriptions at scale. In total, some EUR 30 million is offered to qualified, private off-grid energy service providers under three different Country Programmes, with funding opportunities split into a number of Funding Windows and Funding Lots. The contract size is expected to be EUR 1 – 4 million, depending on the target country and individual needs.
The plan is to have some 15 contracts signed under BGFA1 and awarded funds will be disbursed during a four-year period. By 2025, it is expected that up to 700,000 off-grid long-term sustainable energy service subscriptions have been entered into with customers, bringing clean and affordable energy to more than 3.5 million people in peri-urban and rural areas.
Beyond the Grid Fund for Africa is funded by Sweden, through the Swedish International Development Cooperation Agency (Sida) and the Swedish Embassies in the target countries, Denmark, through the Ministry of Foreign Affairs, Germany through the KfW Development Bank, and PowerAfrica, an initiative administered by USAID. Nefco is managing the facility and the programme is implemented in cooperation with Renewable Energy and Energy Efficiency Partnership (REEEP).
Sweden is contributing EUR 80 million (SEK 800 million) for the first expansion into Burkina Faso, Liberia and the Democratic Republic of the Congo and the second phase in Zambia, to the separate expansions into Mozambique and Uganda as well as to the separate clean cooking programme. Denmark is supporting the expansion into Uganda with an EUR 15.8 million contribution (DKK 117.5 million). Power Africa is providing an in-kind technical assistance contribution worth approx. EUR 4 million (USD 4.5 million) over three years. Germany, through its development bank KfW, is supporting the Zambian Country Programme with an EUR 7.5 million contribution, with a special focus on mini-grids deployment.
Several other donors have also shown interest in joining the programme. If your institution or organisation is interested in contributing as a donor or supporter to the Beyond the Grid Fund for Africa, please contact us.
Staff news in the BGFA Unit of Nefco
With effect from 1 December 2021, Ash Sharma has taken over Helle Lindegaard’s responsibilities as Vice President and Head of the Beyond the Grid Fund for Africa (BGFA) Unit in Nefco, and Helle has undertake the role as Executive Advisor, providing support to the Managing Director of Nefco, Ash and the BGFA team.