Zafiri announces US$176m commercial launch to accelerate energy access via the private sector across sub-Saharan Africa

At the Africa Energy Forum being held in Cape Town this week, Inspired Evolution has announced the US$176-million commercial launch of Zafiri, a blended permanent-capital vehicle focused on expanding access to electricity for tens of millions of people across sub-Saharan Africa.

Inspired Evolution, a leading African climate investment firm, was mandated by the investors to be the investment manager of Zafiri. Founding shareholders include the International Finance Corporation (IFC), a member of the World Bank Group; the African Development Bank Group (AfDB), including its Sustainable Energy Fund for Africa (SEFA); The Rockefeller Foundation; Trade and Development Bank Group (TDB Group); Nordic Development Fund (NDF); MacArthur Foundation; and FirstRand Limited.

This launch underscores Zafiri’s role of investing in and supporting the private sector as part of Mission 300, a joint initiative co-led by the World Bank Group and the AfDB Group – with support from The Rockefeller Foundation, the Global Energy Alliance for People and Planet, and Sustainable Energy for All – to expand electricity access to 300 million people in sub-Saharan Africa by 2030.

Zafiri is a blended finance vehicle that aims to invest in high-impact projects while maintaining financial sustainability. It will spur job creation, help connect more businesses to power, and put electricity to productive use that drives local economic activity.

It will deploy patient equity into distributed renewable energy (DRE) companies and projects across sub-Saharan Africa, including mini-grids, solar home systems, productive-use energy solutions and clean cooking enterprises. At least 50% of the platform’s capital is expected to support mini-grids, solar home systems and clean cooking.

Zafiri addresses one of Africa’s toughest energy financing gaps by channelling long-term equity into DRE companies bringing reliable, affordable power to communities beyond the reach of traditional grids. Following its commercial launch, Zafiri expects to reach a final close of US$300 million within 12 months, with a longer term ambition to scale up to US$1 billion to accelerate energy access in Africa.

Ethiopis Tafara, IFC vice-president for Africa, said: “Zafiri’s commercial launch delivers on what we promised at the Mission 300 launch: mobilising equity at scale to close a critical development finance gap and accelerate investment into the fast-growing DRE sector. By blending capital and continuing to de-risk these investments, Zafiri will help connect people and businesses, create jobs and deliver tangible human benefits. We call on more partners to join us to expand such initiatives.”

Noted Dr Kevin Kariuki, VP for Power, Energy, Climate & Green Growth at the AfDB: “DRE solutions, including mini-grids and standalone solar home systems, are projected to contribute at least 50% of new connections by 2030. Catalysed by the Africa Development Bank’s SEFA catalytic junior equity, Zafiri is therefore most timely, and its US$176-million commercial launch an important milestone, as it will avail long-term and much-needed equity to scale DRE companies, thereby accelerating the ambition of Mission 300.”

“Zafiri represents an innovative multi-stakeholder partnership, forged under the World Bank’s Mission 300 Initiative, that leverages the positive attributes of multilateral agencies, development institute finance and philanthropic funders, together with private sector agility and competencies,” commented Wayne Keast, managing partner at Inspired Evolution. “Zafiri is core to our vision and mission, which includes the provision of long-term, patient, blended finance mechanisms to accelerate energy access and inclusion for Africa’s underserved communities. We are proud to be the chosen private sector investment manager to implement Zafiri across the region. Underpinned by country compacts, Zafiri will enable clean and affordable DRE solutions in contribution to an African just energy transition.”

Ghita Benabderrazik, managing director of Innovative Finance at The Rockefeller Foundation, said: “Zafiri is designed to address one of the most persistent barriers to energy access by scaling equity investment in distributed renewable energy companies that serve communities across sub-Saharan Africa. By bringing catalytic capital to Zafiri, The Rockefeller Foundation aims to help de-risk an underfinanced market, mobilise long-term investment and contribute to a more resilient financing ecosystem for DRE: one that can power livelihoods, expand economic opportunity and advance inclusive, sustainable development at scale.”

“TDB Group is really pleased to join forces with its MDB strategic partners and others as an equity investor in Zafiri, in support of several renewable energy sub-sectors on the continent,” stated Admassu Tadesse, TDB group president and managing director. “The Zafiri Permanent Capital Vehicle represents a very much-needed boost to the risk capital of DRE and clean cooking companies that face binding equity capital constraints for their long-term growth, including their limited ability to better leverage long-term debt, which TDB has already been actively providing as part of the Mission 300 initiative. Our participation in this latest thrust is testament to our deep commitment to injecting patient capital toward inclusive, climate-aligned growth across our Member States.”

Satu Santala, NDF managing director, also commented: “NDF celebrates Zafiri’s launch together with the partners as an important milestone to scale up access to distributed renewable energy in sub-Saharan Africa. Through catalytic financing, Zafiri’s success will help mobilise significant commercial financing into currently under-invested DRE sub-sectors with the aim of transforming lives and livelihoods of climate-vulnerable communities.”

“Expanding access to clean, reliable, affordable energy is a critical global economic development need. We’re excited to collaborate with leading impact investors on this innovative vehicle that will accelerate the flow of capital toward addressing this important challenge,” added Charles Coustan, portfolio manager at the MacArthur Foundation.

Mary Vilakazi, CEO of FirstRand Limited, said the group is proud to be the only commercial bank and founding investor in this consortium. “This highly innovative initiative is in line with FirstRand’s long-term strategy to partner with global development finance institutions and other capital providers to solve Africa’s energy needs.”