Stimulating private investment in renewable energy in sub-Saharan Africa
GAP is a fund established by the Private Infrastructure Development Group (PIDG) to stimulate private sector investment in renewable energy in sub-Saharan Africa. Acting as a long-term source of financing and policy support to projects, investments can be in any DAC 1, 2 or 3 countries and can be based on any renewable technology such as wind, hydro, solar, geothermal or biomass.
The UK Government has provided funding of £95 million through the Department for International Development (DFID) and the Department for Business, Energy and Industrial Strategy (BEIS). The Norwegian Ministry of Foreign Affairs has also committed £25 million.
GAP has the ambitious target to finance approximately 900MW of new renewable energy generation capacity in six years, saving 39m tonnes of carbon emissions and improving the supply of clean energy to millions of people in sub-Saharan Africa.
Sub-Saharan Africa is the world’s most power-starved region, with more than 700 million people lacking access to electricity. There is a shortage of all types of power generation projects in sub-Saharan Africa but particularly renewable power projects. GAP has been designed to counter market failures which inhibit the growth of renewables in the region by reducing the upfront cost of capital while maintaining overall commercial returns and providing cover for specific construction phase risks.