The Overseas Private Investment Corporation (OPIC), the USA government’s development finance institution, has provided initial financing to SunFunder’s US$85mn Solar Energy Transformation (SET) Fund which supports businesses providing solar solutions in sub-Saharan Africa and India
The financing is part of a US$25mn commitment of senior and junior debt OPIC entered in September 2018.
Since OPIC committed financing, two other lenders have also committed loans, bringing the first close total raised to US$42.5mn. This blended financing package includes US$7.5mn from Calvert Impact Capital and US$5mn from Ceniarth. The IKEA Foundation also provided a grant of US$5mn million as catalytic capital for the fund.
“This project will advance OPIC’s mission of empowering people in some of the world’s poorest countries by bringing affordable electricity to remote areas that are not connected to an electricity grid,” said Ray W Washburne, president and CEO at OPIC.
Boosting energy access
The SET Fund is expected to improve energy access for three million people and mitigate 480,000 tonnes of CO2 emissions annually over the nine-year life of the fund.
“SunFunder has now closed more than US$100mn in diversified solar debt funds and the SET Fund opens up new opportunities. As our largest fund and with a nine-year tenor, the SET Fund increases both the range and size of debt capital offerings that we can provide, especially for productive use solutions and commercial projects,” said Ryan Levinson, founder and CEO at SunFunder.
OPIC’s support of this project advances several agency priorities including the 2X Women’s Initiative, which supports women-owned and women-led businesses.
By bringing electricity to some of the hardest to reach communities in Africa, these projects also advance the USA Power Africa initiative to bring electricity to millions of people in sub-Saharan Africa who live without power.
OPIC previously committed financing to another SunFunder-managed fund, the Beyond the Grid Solar Fund, which has provided financing for off-grid companies in Africa, India, the Pacific Islands and Jordan. Calvert Impact Capital and Ceniarth also both invested in previous SunFunder debt funds.