The Africa Renewable Energy Fund (AREF) has accumulated $100 million in order to fund the clean energy projects in sub-Saharan Africa. The group expects the numbers to double this year, a spokesperson from AREF announced.
The fund is supervised by Berkeley Energy Africa and will be given to independent power producers of solar, hydro, wind, biomass, geothermal, and waste gas projects. These big projects will be committed to the development of clean energy and will be able to acquire more than $30 million in funding.
More and more companies are looking at green energy since the production of renewable power sources went down to 50% since 2008. Sulzer Ltd., a Swiss engineering firm that is in partnership with Middle Eastern oil construction company Unaoil, was correct when they said that the production of renewable power is expected to grow and will offer manufacturers and service providers promising business opportunities.
The African Development Bank contributed $65million to the cause, making it the primary sponsor of AREF. It is also responsible for bringing sustainable energy and financial knowledge through its contacts with other green energy groups such as the Sustainable Energy for Africa (SEFA).
Gabriel Negatu, African Development Bank’s regional director, is hopeful that more than $200 milion will be raised by the end of the year. “The $200m is not the end of it. The whole idea is that this is supposed to catalyze and crowd in other investors, so I can assure you that in a few years’ time, we may be looking at maybe $1bn or $500m,” said Negatu in during the launching of the funding intiative.
To date, contributors to the cause include the West African Development Bank, Dutch development fund FMO, Ecowas Bank for Investment and Development, Berkeley Energy, and Togo-based African Biofuel and Energy Company.