AECF launches Competition targeting Private Sector in Renewable Energy in Burkina Faso
Ouagadougou, Burkina Faso, August 31st, 2018: Today, The Africa Enterprise Challenge Fund (AECF) with financial support from the Swedish Embassy in Burkina Faso, launched the Renewable Energy and Adaptation to Climate Technologies – sub-Saharan Africa (REACT SSA) competition in Ouagadougou, Burkina Faso. This is a five year program worth US $6.5 million that seeks to catalyse the private sector to increase access to energy and clean cooking solutions to the rural population in Burkina Faso. Private sector companies will be able to access grants of between US $100,000 and US $1.5M as well as Technical support.
Energy access in Burkina Faso is low, especially for the rural population with only 3% of the population connected to the national grid. Grid electrification in Burkina Faso stands at 18.8% with a disparity between rural and urban populations; rural access stands at merely 3% i.e. only 575 localities out of 8,900 are electrified. Burkina Faso’s electricity mix includes electricity imports and hydro-power which has significantly increased the cost of electricity making it one of the highest in the region i.e. Euro 0.21 per kilowatt-hour (kWh) making it out of reach for most rural population.
“Burkina Faso is characterised by towns living below medium-voltage (MV) or high-voltage (HV) lines better known as fly over towns. These towns are mainly in peri-urban and rural areas, and are as a result of high connection costs ranging between US $70 to US $270 in rural and urban areas respectively. As a development partner we believe that this situation can be addressed by investing in private sector to provide sustainable and affordable clean energy solutions. The launch of the REACT SSA Burkina Faso program is therefore timely and will contribute towards the government’s efforts of increasing energy access in the country,” said, Mr Aboudolye Sanou, Embassy of Sweden in Burkina Faso.
Burkina Faso possesses natural resources that can allow for a significant contribution of renewable generation in its energy mix. Under SE4ALL, the government has set a target of 50% of renewable energy in the mix by 2030 (excluding biomass). The country occupies an important role in the emergence of a regional electricity market linking the Sahel to Ivory Coast and Ghana, and the Ministry of Energy considers that speeding up interconnection can lead to both cheaper and more reliable energy supply in Burkina Faso.
“Over the past eight years AECF has invested in successful business models in Africa that have impacted the lives of rural communities in the region. Through these investments in renewable energy products and services we have transformed the livelihoods of over 6.6 million people . Our experience in the region and the financing we provide will therefore incentivise businesses in Burkina Faso to replicate models that have worked in other regions as well as attract businesses in advanced markets to replicate their models in a country like Burkina Faso,” said Daniel Ohonde, CEO, The AECF.
AECF has been fundamental in funding innovative business models that have grown in market winners these include solar home systems, the pay-as-you-go, cleaning cooking solutions like bio gas, bio-fuels, ethanol amongst others.
Sweden International Development Agency (Sida) is a government agency working on behalf of the Swedish parliament and government, with the mission to reduce poverty in the world. Through our work and in cooperation with others, we contribute to implementing Sweden’s Policy for Global Development (PGU). We implement the Swedish development policy that aims to enable people living in poverty to improve their lives. Another part of our mission is reform cooperation with Eastern Europe. The third part of our assignment is to distribute humanitarian aid to people in need of assistance.
About the AECF
AECF is an Africa-based USD $356 million Enterprise Challenge Fund that works with the private sector on a risk sharing basis across 25 African countries to reduce poverty. It provides catalytic funding as grants or zero interest loans to private sector businesses that have a positive impact on the rural poor in sub-Saharan Africa. The fund awards grants and/or loans to projects focused on agriculture, agribusiness, renewable energy and adaptation to climate change with the aim of improving household incomes and reducing rural poverty. The fund is supported by Australia, Canada, Denmark, The Netherlands, Sweden and United Kingdom governments, international financial institutions, Consultative Group to Assist the Poor (CGAP) and IFAD.
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