AfDB invests $10m in Climate Innovation Fund

The Board of Directors of the African Development Bank Group has greenlighted a $10 million junior equity investment in the KawiSafi II Fund.

This strategic financing will channel resources into local businesses dedicated to creating and expanding climate projects that directly benefit vulnerable communities across the continent.

The funding comes from the Sustainable Energy Fund for Africa (SEFA), a pioneering financing initiative managed by the Bank Group.

KawiSafi II is a robust $200 million venture equity fund designed to bridge critical investment gaps in energy transition, productivity, mobility, and logistics throughout sub-Saharan Africa. It features a dedicated $10 million technical assistance facility aimed at maximizing climate impact and promoting robust management of environmental, social, and governance risks.

The African Development Bank’s catalytic commitment is poised to unlock additional investments into innovative African start-ups that are tackling climate change through renewable energy solutions. KawiSafi II builds on the success of its predecessor, KawiSafi Fund I—a $67 million off-grid energy fund established in 2016, which was backed by the well-respected Acumen Fund. Acumen, with over two decades of experience in investing in transformative companies addressing global poverty, has successfully supported ventures like D.light, Bboxx, and BioLite.

Amar Inamdar, Managing Director of KawiSafi Ventures, emphasized the importance of the Bank’s investment, stating, “The African Development Bank’s investment into KawiSafi II is catalytic for helping us reach a first close and attract the significant private capital that is urgently required to support Africa’s climate innovators.”

He highlighted the Bank’s role as a leading development finance institution, which is crucial in leveraging investments into pioneering start-ups focused on renewable energy and clean mobility.

João Duarte Cunha, Manager of the Bank Group’s Renewable Energy Funds Division, noted that KawiSafi II represents a unique opportunity to provide much-needed venture and growth capital to businesses focused on energy access and transition during a critical time for the market.

This investment through SEFA not only underscores the African Development Bank’s commitment to facilitating a just energy transition but also exemplifies its strategic partnerships with the private sector, aimed at fostering innovative solutions to combat climate change in Africa.

As the continent faces pressing environmental challenges, the Bank’s proactive approach is set to empower a new wave of climate-conscious enterprises that are essential for a sustainable future.

This announcement was made public through the APO Group on behalf of the African Development Bank Group.