IFC and SIMA Invest $150M in Solar Green Bonds for African Projects

• IFC and SIMA Funds join forces to finance solar projects in Africa, supporting small businesses and promoting sustainable energy solutions. A game-changer for the continent's solar sector.

The International Financial Corporation (IFC) and Social Investment Managers and Advisors LLC (SIMA Funds) have reached the first close of a $150 million solar green bond to finance productive-use solar projects in Africa. The bond aims to support the growth of small and medium-sized enterprises in the rooftop solar sector, focusing on sectors such as manufacturing, services, education, healthcare, and agri-processing. The financing package for the bond includes a $25 million loan from IFC, as well as loans from other partners such as the Finland-IFC Blended Finance for Climate Program and the Global Energy Alliance for People and Planet. The bond is expected to finance over 220 MW of on-site solar energy and energy storage projects, reducing carbon emissions by an estimated 4 million tons over the life of the assets.

Access to affordable financing has been a major challenge for smaller businesses in Africa seeking solar solutions. The bond aims to address this issue and promote sustainable energy solutions. The partnership between IFC and SIMA Funds will focus on commercial and industrial solar projects, as well as providing technical assistance to developers. The bond has received support from various lenders, including the Shell Foundation, the US Development Finance Corporation, and the German Development Finance Institution. A second close is expected to take place in April 2024, led by private sector investors. Moody's has assigned the highest grading to the bond's sustainability.

How will the $150 million solar green bond support small businesses in Africa?

• The $150 million solar green bond will provide affordable financing options for small businesses in Africa.
• The bond will specifically support the growth of small and medium-sized enterprises in the rooftop solar sector.
• The financing package for the bond includes a $25 million loan from the International Financial Corporation (IFC).
• Other partners, such as the Finland-IFC Blended Finance for Climate Program and the Global Energy Alliance for People and Planet, will also provide loans for the bond.
• The bond aims to finance over 220 MW of on-site solar energy and energy storage projects.
• This financing will help reduce carbon emissions by an estimated 4 million tons over the life of the assets.
• Access to affordable financing has been a major challenge for smaller businesses in Africa seeking solar solutions, and the bond aims to address this issue.
• The partnership between IFC and Social Investment Managers and Advisors LLC (SIMA Funds) will focus on commercial and industrial solar projects.
• Technical assistance will also be provided to developers to ensure the successful implementation of the projects.
• The bond has received support from various lenders, including the Shell Foundation, the US Development Finance Corporation, and the German Development Finance Institution.
• A second close is expected to take place in April 2024, led by private sector investors.
• Moody's has assigned the highest grading to the bond's sustainability, indicating its strong environmental and social impact.