Germany: Powering Through East Africa
By admin August 7, 2015


The German-owned development bank, KfW, has recently opened up a line of credit that will provide for the funding of African renewable and energy efficient projects.

The fundamental aim of this funding is to encourage the development of solar and wind power projects. Such an agreement comes after a Frankfurt-based KfW’s investment and development subsidiary, DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH, (DEG), agreed to finance the German-based solar SME Company Mobisol in East Africa by means of providing off-grid solar systems to housing in rural areas. In addition, KfW has pledged renewed support for trade finance business in Africa. East Africa is merely a drop in the ocean, as one of Mobisol`s larger strategic goals is to expand further energy projects throughout sub-Saharan Africa.

This project involves innovative patent solar home systems, which are environmentally friendly and come in a range of watt ranges. Customers are able to pay via SMS from a mobile telephone using monthly payments – which is 30 cents per day for the smallest systems. The price includes training on how to install a system and maintenance by local partners.

Solar power is an important energy source in sub-Saharan Africa. Mobisol`s presence in East Africa will definitely help to bridge energy backlogs as it is a prime source of energy amongst other alternative energy sources. DEG said: “Mobisol has already equipped over 21,000 households in Tanzania and Rwanda with off-grid solar power systems. The current financing enables the company to further expand. It is envisaged that 150,000 people in rural East Africa will use Mobisol systems in the future. Moreover, 10,000 micro entrepreneurs are expected to generate an income amounting to $10 million annually.”

Similar projects have taken shape as early as the beginning of 2014. The Energy Access Ventures is dedicated to financing projects by small firms which promtoe access to energy sources. KfM states that “The Energy Access Ventures Fund has secured commitments of €54.5m to invest in five-year instruments for about 20 African SMEs, with the aim of expanding infrastructure to provide electricity for the first time to up to one million people in the region by 2020.”

The African Development Bank (AfDB) has also made sufficient strides in the promotion of access to energy sources. The Sustainable Energy Fund for Africa (Sefa) had approved a preparation grant in a bid to develop a number of “solar-hybrid mini grids” in rural growth centers in Tanzania. With Tanzania’s national electricity coverage covering an estimated 21%, with the transmission grid covering a minor part of the country and leaving out most of the territory, particularly in western and southern regions, this project could not come at a more opportune time.

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