Overview of Financing Options for RE Projects in West Africa" Lagos, 23. August 2016

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1 Overview of Financing Options for RE Projects in West Africa" Lagos, 23. August 2016 Westwood Hotel, Ikoyi, Lagos

2 The Delegations of German Industries and Commerce (DGIC) in Lagos, Nigeria and Accra, Ghana Are the official representatives of the German industry in Ghana and Nigeria. We are partnering with the Federal German Ministry for Economics and Technology (BMWi) abroad and provide information for German Companies on the Ghanaian and Nigerian business environment as well as information for Ghanaian and Nigerian businesses who want to engage themselves in Germany.

3 Services provided by DGICs / General business development services: Advisory services, fact finding missions, address research, market studies, information on taxes and procedures, B2B meetings, Trade Fairs, Business Delegations, and many more. the Dual Vocational Training Partnership with Germany is an additional program in Nigeria. It assists in scaling skill gaps in technologies involving manufacturing, construction and commerce. We also help companies to establish contacts with the German development cooperation, as there are the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH and Sequa ggmbh.

4 The ExperTS Programme supporting DGICs Target of the ExperTS Programm and posting of ExperTS into Delegations is to merge German federal external economic promotion with development cooperation. Activities ExperTS establish special services on renewable energy and environment and take over a pioneering role among the existing chambers in the countries. Distribution Currently 10 ExperTS are posted in Delegations world wide.

5 The ExperTS- Programme Current postings of Integrated ExperTS in the areas of Renable Energy Renawable Energy and Energy Efficiency

6 Energy potential in Nigeria

7 Business opportunities in Ghana in the RE sector Solar PV homes systems projects small scale for private homes ( homes government program). Solar PV projects medium to large scale for corporations. Solar PV utility sized projects. Net Metering will hopefully give another push in the solar PV sector. Mini-hydro projects. Interest in biogas and biomass power plants. Several are in a stage of realization. Interest in wind power plants but none has been realized in recent years. Tidal wave power plant (at the moment only very small but planed for up to 1 GW).

8 Business opportunities in Nigeria in the RE sector Solar PV homes systems projects small scale for private homes. Solar PV projects medium to large scale for corporations. Solar PV utility sized projects. Off-grid solar PV and hybrid power plants. Potential in biogas and biomass power plants. Potential in wind power plants on-shore and off-shore.

9 General Findings in the Sector Obstacles entrepreneurs are facing in both countries: Non implementation of promised incentives for renewables (reduced import costs, tax holiday). Extensive sales of substandard products and copies of brands. Limited human capacity through lack of quality trainings and training facilities in the country. High hurdles and insecure ownership when acquiring land. Unclear regulations and changing tariffs making it difficult to calculate return of investment. Clean energy, business is limited since gas supply is mainly restricted to the shore lines and road infrastructure is not favorable. However, the most important need for businesses, customers and investors is to acquire long-term loans at feasible interest rates.

10 SEFA Sustainable Energy Fund for Africa Grants and technical support for project development during project preparation 1 million USD, evtl. higher IPPs, private companies Total project investment between million USD; min. 30% co-financing required

11 EIB European Investment Bank Loans, Mezzanine, Equity, Guaranties and Grants <25 million EUR via partner banks, >25 million EUR via direct application Private companies For loans above 25 million EUR feasibility study required EU-AITF EU-Africa Infrastructure Trust Fund Technical support via grants n.a. African public and private applicants Grants depend on positive loan commitment from EIB; project must have regional content, poverty alleviation, economic development or trade impact

12 AECF Funding Innovation for Business in Africa Loans and grants <1.5 million USD, zero interest Private companies Business idea in Africa, innovative, must have development effects

13 AEF (FMO) Access to Energy Fund Equity participation <20%, loans Equity <10 million EUR, loans <20 million EUR Private companies Energy producers IDF (FMO) Infrastructure Development Fund Long term loans <20 million EUR Project developers General infrastructure

14 ENGIE ENGIE Rassembleurs d Energies <40% equity 100,000 1 million EUR Private companies Economic and social components EBID ECOWAS Bank for Investment and Development Loans, long term 5 30 million EUR Private companies Projects in West Africa, equity requirement of 30%

15 Gari (Fond Gari) Guarantee Fund for Private Investments in West Africa Hedging (guarantee) of project risk 100,000 6 million USD (max of 60% of project value covered) Private companies Positive loan commitment

16 Crowd Funding bettervest Loans (Crowd financing) 50,000 bis maximal 2,500,000 Private Inverstors, SMEs, NGOs, Local Communities Company registered in Germany or Italy (possibly soon in Nigeria); Active for 3 years General Observations Crowd Funding There seem to be a number of newly founded crowdfunding platforms on the market, however some of them are still in forming stages, e.g. TRINE, ecoligo.

17 Microfinance Short term loans 2 million to 20 million Naira SMEs Short term loans 6 to 24 months in monthly rates beginning with first month

18 Our presentation only constitutes an extract of the available funding opportunities for energy projects. A full compilation of funding institutions comprising Ghana, Kenia, Nigeria and South Africa will be available by the end of the year Bärbel Freyer Head of Energy and Environment Department Tel.: +234 (1) /7 Fax: +234 (1) freyer@lagos-ahk.de nigeria.ahk.de Mr. Michael Neulinger Head of Energy and Environment Department Tel.: /2/3 Fax: michael.neulinger@ghana.ahk.de ghana.ahk.de

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