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EU launches fund to support power projects in East Africa

Xinhua, April 1, 2015 Adjust font size:

Europe-backed electricity fund has been launched to improve access to sustainable energy, transform lives and stimulate economic development in East Africa, the European Union (EU) officials said on Wednesday.

The Electricity Access Fund, launched by EU private companies, investors and donors, is an investment facility specifically designed to attract private investment to increase electricity access for poor and remote communities in East Africa.

"I am excited about what this new spirit of entrepreneur-led development can do for East Africa, and see a larger role for it in our work going forward," Erik Habers, head of development cooperation at the EU in Kenya, said in Nairobi.

The 60 million U.S. dollar facility, which begins in Kenya and later Uganda, Rwanda and eventually West Africa, aims to bring a supply of reliable, affordable electricity to almost 2 million people.

Habers said a fifth of the investment fund is being provided by the EU, managed by the European Investment Bank. Other investors include the French Development Agency, Britain-based Commonwealth Development Corporation and others.

Habers said innovative use of financing has the potential to unlock the benefits of private investment and build electricity supply for millions of people and small businesses. "Like for the Kenya government, improving access to reliable, affordable energy for consumers, businesses and industry is a priority of our development agenda," he said, adding "we can use development aid to absorb risk, build investor confidence and accelerate economic growth for a wider number of people."

Habers said the investment will focus on generating sources of electricity for those who are "off-grid" particularly in rural and semi-urban poorer neighborhoods, and will operate over an initial ten-year period.

The fund is part of a global investment facility, which was established within the Framework of the Cotonou Agreement on cooperation and development assistance negotiated between 78 African Caribbean Pacific States and the EU. Endi