Out-Law News | 18 Dec 2014 | 5:09 pm | 1 min. read
The African Development Bank (AfDB), which hosts the Sefa fund, said the grant would support the “corporate expansion” of Addis Ababa-based dVentus in the energy efficiency equipment sector.
“Specifically, the grant will finance a market and bankability study as well as product validation and certification with the aim of mitigating part of the technical development risks and catalysing the financing required for the transition and expansion plan,” the AfDB said.
In addition, the AfDB said the project “will help demonstrate the viability of indigenous high-tech suppliers for the growing clean energy sector in Africa”. The grant will also help boost private funding “in an industry of key importance for enabling investments in renewable energy and energy efficiency”.
Once operational, the manufacturing facility “will provide products that will lead to an improvement in power distribution and generation and help address Ethiopia's current and projected energy shortfall”, the AfDB said.
The AfDB said: “Smart electric meters will have a direct impact in efficient billing, load management, tariff management, and theft control resulting in smaller power losses, fewer power outages and better customer service. It is estimated that savings up to $66 million per year and a 50% reduction in distribution losses could be achieved if the two million connected clients in Ethiopia were to use this technology.”
“The project is also expected to contribute to technology transfer of high-tech engineering and to the creation of up to 150 jobs during construction of the manufacturing facility and another 150 jobs during operations, out of which 80% are expected to be highly-skilled jobs,” the AfDB said.
The AfDB said the support to dVentus is in line with the bank’s “broader cooperation” with the US-backed Power Africa initiative, launched by President Barack Obama in 2013, aimed at supporting economic growth and development by increasing access to reliable, affordable, and sustainable power in all of sub-Saharan Africa, including in Ethiopia.
Sefa is a multi-donor facility designed to unlock private investments in small to medium-sized clean energy projects in Africa. The fund is endowed with $60 million from the governments of Denmark and the US.
International Monetary Fund managing director Christine Lagarde said earlier this year that the “scaling up” of energy infrastructure investments in Ethiopia and other African nations were “critical for growth to be sustained”.