Today, Francesco La Camera, Director-General of the Italian Ministry of Environment, Land and Sea signed a €5 million support agreement to ElectriFI – the EU flagship initiative to de-risk sustainable energy investments in developing countries.
Stefano Manservisi, the European Commission’s Director-General for International Cooperation and Development, welcomed the contribution and said: “I commend the Italian government’s commitment to help mobilise private sector investment in rural and underserved areas. All efforts count in order to reach the sustainable energy goals worldwide.”
The Italian support will focus on the Sahel Region and Sub-Saharan countries. This bilateral support adds to the EU Member States’ contribution through the EU budget. Italy is the second country after Sweden - with €5 million - that has provided an additional contribution to the initiative.
ElectriFI entered into operation during the second half of 2016 with a budget of €130 million for a 10-year period. Based on the current pipeline, expected results are 1.5 million direct and indirect connections or the equivalent of 7 million persons, with about 470 MW additional generation capacity and 430 GWh of electricity from renewable sources per year.
Partner countries can also decide to allocate some of the EU’s bilateral development budget to this initiative. By the end of 2018, four countries – Zambia, Benin, Côte d’Ivoire, Nigeria – and the Pacific region had decided to do so, adding €93 million to the ElectriFI budget.
A major investment barrier in access to energy in developing countries is the lack of access to seed, mid- and long-term capital. To address this challenge, the EU launched the Electrification Financing Initiative – ElectriFI at the 2015 United Nations Climate Change Conference in Paris.
This initiative aims at increasing access to affordable, reliable, sustainable and modern energy in developing countries by catalysing energy investments, including in rural and underserved areas. It does so by providing investment support to projects or businesses that have at least entered the active development stage but before traditional financial institutions come in. As such, it is an integral part of the EU External Investment Plan (EIP).
ElectriFI provides support to investors across a range of business models and provides funding primarily through risk capital. ElectriFI encourages the adoption of renewable energy, with an emphasis on decentralised energy solutions.