Studying Time: 2 minutes
The Local weather Aggregation Platform (CAP) of the United Nations Growth Program (UNDP) has launched an innovation course in off-grid photo voltaic financing for rising electrical energy entry in creating international locations, primarily in Africa. The primary version of the initiative named ‘CAP Monetary Innovation Problem’ will cowl East Africa.
The CAP Monetary Innovation Problem goals to develop progressive monetary aggregation constructions and fashions that might assist to extend availability and cut back the clear power financing prices in creating international locations. The competitors will award profitable candidates with as much as $40,000 for creating the proposed improvements.
Monetary aggregation is a technique of bundling a number of power belongings, tasks, or firms into portfolios, which then obtain funding from buyers based mostly on future money flows. This reduces transaction prices and dangers for buyers, together with countering funding limitations and unlocking new financing for small-scale renewable power tasks.
New sources of funding and financing mechanisms are required to shut the funding hole to realize the Sustainable Growth Aim of common entry to wash, reasonably priced, dependable power for all by 2030. A latest report by UNDP and Local weather Bonds reveals that the potential of monetary aggregation for small-scale renewable power investments stays untapped.
Eduardo Appleyard, CAP Undertaking Coordinator, UNDP, stated “Whereas the market remains to be nascent, monetary aggregation may sooner or later be a game-changer for distributed renewable power firms. With the CAP Monetary Innovation Problem we need to help the event progressive options that would result in financially closed transactions within the close to future and finally be scaled up and replicated.”
The CAP Monetary Innovation Problem will facilitate the switch of know-how and progressive options that may assist to beat energy-related challenges in African international locations by way of photo voltaic power. In line with UNDP, off-grid photo voltaic mini-grids are key to offering dependable electrical energy to the under-served communities that don’t have any entry to electrical energy or within the areas the place the grid isn’t dependable.
With funding from the International Surroundings Facility (GEF), the CAP’s initiative will choose as much as 5 tasks in East Africa. This consists of a minimum of one undertaking every in Rwanda and Uganda, respectively. The competitors is open till August 31, 12 pm (EAT).
The competitors can be led by ‘Promote-side’ actors comparable to undertaking homeowners, and power firms builders. Additionally it is open to ‘buy-side’ actors together with affect buyers, growth banks, crowdfunding platforms, and so forth. The CAP has additionally opened this chance to civil society organizations, NGOs, analysis institutes, consultancy companies, and credit-raising businesses.