Energy

MIGA and ISA launch the MIGA-ISA Solar facility to enhance solar energy access with concessional financing, focusing on Sub-Saharan Africa. (Image source: Adobe Stock)

The Multilateral Investment Guarantee Agency (MIGA), a part of the World Bank Group, and the International Solar Alliance (ISA) have unveiled the MIGA-ISA Solar Facility, a multi-donor trust fund

This initiative, supported by the Indian government, aims to broaden global access to renewable energy.

The facility will integrate ISA’s technical expertise with MIGA’s financial mobilisation capabilities, creating an innovative approach to boost global solar energy adoption. It will provide concessional financing, including first-loss instruments and reinsurance, to enhance project viability and reduce the cost of MIGA guarantees. Additionally, MIGA and ISA will collaborate on launching new solar and distributed energy projects in eligible developing nations, with an initial focus on Sub-Saharan Africa and plans for worldwide expansion. This effort is part of a broader initiative supported by the World Bank Group and the African Development Bank to deliver 300 million new electricity connections in Sub-Saharan Africa by 2030.

Administered by MIGA, the facility will scale up guarantee issuances and attract private investment for solar and distributed energy projects, offering affordable risk mitigation solutions to support growth in ISA member countries. ISA has committed US$2mn in seed funding with a target to raise US$10mn for the facility, which is the inaugural program under ISA’s Global Solar Facility (GSF) aimed at raising US$200mn for African projects.

“MIGA is delighted to host the MIGA-ISA Solar Facility and support Sub-Saharan Africa in accessing reliable and clean electricity,” said Hiroshi Matano, MIGA executive vice- president. “The facility will attract private investment by providing risk mitigation and concessional financing, helping to lower costs and close the energy gap in underserved regions.”

To kickstart the facility, MIGA and ISA have already initiated a solar project in the Democratic Republic of Congo. This project is expected to cut operating costs by around 20%, leading to reduced tariffs for customers.

“ISA is excited to collaborate with MIGA on the facility to provide cost-effective guarantee solutions for decentralized solar projects in Africa,” said Ajay Mathur, ISA director general. “This is an important milestone in the roll out of ISA’s GSF. We look forward to delivering clean energy through this program to impact the lives of millions of Africans who remain off-grid to date.”

With approximately 675 million people lacking electricity access, and an anticipated 660 million remaining without power by 2030, the World Bank Group and African Development Bank are collaborating on a major effort to provide electricity to at least 300 million people in Africa by 2030.

The 158.7MW Taiba N’Diaye Wind Farm in Senegal. (Image source: Infinity Power)

Infinity Power, a joint venture between Infinity and Masdar, has set a target of developing 10GW of operational renewable energy across Africa by 2030, and Ahmed Mulla, deputy CEO of the company, sat down Africa Review with to explore this progress

African Review (AR): What progress has been made towards the 10GW goal and are you on course to meet it?

Ahmed Mulla (AM): 10,000MW is a very ambitious target, but currently around 600 million people in Africa – 50% of the population – are without energy access. So, in that context, there is plenty that can be done. Africa is infrastructure. As such, we are working on providing holistic proposals that complement renewable energy generation from solar, wind, biomass and hydro, with the inclusion of battery storage, that is necessary in order to connect the generation to the demand centres.

If we look at our shareholders, we have the Abu Dhabi Future Energy Company (Masdar), whose major shareholder is TAQA. TAQA is heavily interested and invested in infrastructure. Another of our shareholders is the Africa Finance Corporation, also heavily focused on infrastructure in the continent.

We don’t just have the financial backing of our shareholders, but also their expertise and willpower to invest in the necessary foundations to deploy the renewable energy required.

AR: How are you countering some of the challenges that come associated with financing projects on the continent?

AM: We are venturing out of our core markets (Egypt and South Africa) which have a bankable, predictable regime and tenders. We are going into new markets, some of which do not have the ability to provide sovereign guarantees, and this is one challenge we see.

Sovereign guarantee is one of the benchmarks that is required by the international financial institutions to deliver a bankable opportunity. Now we are working with many of our partners and legal service providers to come up with innovative solutions that can cover the risks that normally would be covered by a sovereign guarantee, but through service providers in the industry. This would enable us to unlock many challenging markets that have a high demand but, in the past, were inaccessible due to the unavailability of these guarantees.

Discover the full interview in the September issue of African Review

The 165.6MW Benban solar plant in Egypt, which uses Astronergy solar module products. (Image source: Astronergy)

Astrongergy, an intelligent manufacturing enterprise focusing on photovoltaic cells and modules, is preparing to ship 1GW of n-type TOPCon solar modules to Algeria as part of the country’s 1GW solar plant construction plan

The company announced the order after winning the tenders from China International Water & Electric Corp. and the Power Construction Corporation of China. It will be part of the 2GW power plant construction plan proposed by Algeria’s state-owned power utility, Sonelgaz. This will include the delivering of 15 solar plants across the country’s 12 provinces, each with a capacity ranging from 80-220MW, most of which will be built by Chinese companies.

Astronergy won six of these major projects: Abadla (80MW), Batemete (220MW), Gueltet Sidi Saad (200MW), Douar El Maa (200MW), Ouled Djellal (80MW), and Biskra (220MW). Construction on the latter, Biskra, has already begun, making use of Astrongergy’s N5 TOPCon solar modules.

Southern Africa’s rich renewable resources could help form the basis for a thriving hydrogen economy. (Image source: Synergy Consulting)

According to Synergy Consulting, southern Africa stands at a pivotal moment in its energy transition, with the hydrogen economy emerging as a key element in the region's sustainable future

This potential shift could address energy security concerns, contribute to economic diversification, and support global decarbonisation efforts. As nations within the region explore this opportunity, several factors – including abundant natural resources, strategic partnerships, and technological advancements – will play crucial roles in shaping the future of hydrogen energy in southern Africa.

Abundant renewable resources

One of the most significant advantages for southern Africa in developing a hydrogen economy is the region's rich renewable energy resources. Countries like South Africa and Namibia have vast solar and wind energy potential, which are essential for producing green hydrogen through electrolysis. Green hydrogen, derived from renewable energy sources, is seen as a clean and sustainable alternative to fossil fuels. This presents an opportunity for southern African nations to leverage their natural resources to produce and export green hydrogen, positioning themselves as key players in the global hydrogen market.

South Africa, in particular, is well-positioned due to its established infrastructure and industrial base. The country has a history of hydrogen production through coal gasification and is home to some of the world’s largest platinum reserves, a critical material for hydrogen fuel cells. This makes South Africa a strategic location for developing a comprehensive hydrogen value chain, from production to utilisation in various industries.

Economic diversification and job creation

The hydrogen economy offers a path toward economic diversification in southern Africa, particularly for countries heavily reliant on fossil fuel exports. By investing in hydrogen technology, these nations can reduce their dependence on volatile oil and gas markets and create new revenue streams. Moreover, the hydrogen economy has the potential to generate significant employment opportunities, from research and development to manufacturing and logistics.

For instance, developing hydrogen production facilities, refueling stations, and fuel cell manufacturing plants would require a skilled workforce, contributing to job creation in urban and rural areas. This is particularly important in a region where unemployment remains a pressing issue.

Strategic partnerships and investments

The successful development of a hydrogen economy in southern Africa will depend on strategic partnerships and investments. International collaboration is essential, as it brings in financial resources, technical expertise, and market access. Partnerships with countries and companies leading in hydrogen technology can help southern African nations accelerate their hydrogen initiatives and integrate into the global hydrogen supply chain.

Several countries, including Germany and Japan, have already shown interest in collaborating with southern African nations on hydrogen projects. These partnerships could facilitate technology transfer, capacity building, and infrastructure development, crucial for the region’s hydrogen economy.

Challenges and the road ahead

Despite its potential, the hydrogen economy in southern Africa faces several challenges. These include high initial investment costs, the need for regulatory frameworks, and the development of a robust infrastructure. Additionally, ensuring that hydrogen production is truly green – i.e., derived from renewable sources – is essential to avoid merely shifting emissions from one sector to another.

In conclusion, while southern Africa has significant opportunities in the hydrogen economy, realising its full potential will require coordinated efforts across governments, industry, and international partners. With the right strategies in place, southern Africa could emerge as a leader in the global hydrogen market, driving sustainable development and economic growth in the region.

This article is authored by Synergy Consulting IFA