NEWS

The African Development Bank (AfDB) is stepping up efforts to mobilize the resources required to deliver Mission 300—the joint AfDB–World Bank initiative to connect 300 million Africans to electricity by 2030. Recognizing that Africa’s energy access challenge cannot be met by public funds alone, the Bank is developing a suite of innovative financial instruments to crowd-in private and institutional capital.

Speaking during the Africa Capital Markets Forum (ACMF) held earlier this month in Johannesburg, Wale Shonibare, AfDB’s Director for Energy Financial Solutions, Policy and Regulation, said the new tools are designed to bridge the gap between policy ambition and market realities.

“Political alignment has created the foundation for financing. Forty-eight Heads of State have endorsed the Dar es Salaam Declaration—a powerful commitment to reforms that make investment possible,” Shonibare explained. “Our focus now is to channel Africa’s own capital—USD 1.8 trillion in savings—into its infrastructure needs by offering credible instruments that reduce risk and build investor confidence.”

Among the instruments unveiled were the Mission 300 Local Currency Guarantee Facility and the Catalytic Floor Price Guarantee. The former aims to de-risk local-currency lending and encourage domestic financial institutions to extend affordable, long-term credit to energy SMEs. With a modest concessional base, the facility could mobilize up to ten times more private investment, targeting distributed renewable-energy providers and off-grid developers.

The Catalytic Floor Price Guarantee, currently under design, aims to stabilize tariffs and mitigate merchant risk in competitive regional power markets, such as the Southern African Power Pool. 

By establishing a minimum floor price for power sales, the mechanism enhances project bankability and facilitates the attraction of private investment in renewables.

“These facilities demonstrate the Bank’s leadership in blending capital, de-risking private participation, and strengthening Africa’s domestic financial systems,” added Shonibare. “They align perfectly with our long-term vision of deepening local capital markets and ensuring that energy access becomes a reality for every African household.”

Beyond guarantees, the AfDB Board recently approved a USD 40 million equity investment in Project Zafiri, a flagship Mission 300 platform that will deploy patient capital for mini-grids and solar systems across the continent. Project Zafiri is expected to unlock over USD 1 billion in private investment and bring clean, reliable energy to millions of people.

These developments underscore the AfDB’s commitment to mobilizing African and global capital through partnerships with institutions such as the African Guarantee Fund, the Global Energy Alliance for People and Planet, the International Finance Corporation, and the Rockefeller Foundation. They also reinforce the Bank’s strategy of financing reform through innovation, ensuring that every dollar invested in Africa’s power sector generates lasting, inclusive impact.