Climate tech innovation in Africa gets $10 million boost from AfDB

Things are looking up in the climate tech innovation in Sub-Sahara Africa, courtesy of an investment of $10 million by the African Development Bank (AfDB) to boost the sector.

The AfDB said the $10 million investment is being deployed from its Sustainable Energy Fund for Africa (SEFA) into the Persistent Africa Climate Venture Builder Fund (ACV Fund) to propel climate technology entrepreneurship across the continent.

SEFA is a multi-donor Special Fund that provides catalytic finance to unlock private sector investments in renewable energy and energy efficiency. It offers technical assistance and concessional finance instruments to remove market barriers, build a more robust pipeline of projects, and improve the risk-return profile of individual investments.

The Fund’s overarching goal is to contribute to universal access to affordable, reliable, sustainable, and modern energy services for all in Africa, in line with Sustainable Development Goal 7 and Mission 300.

Interestingly, SEFA’s strategic investment is expected to attract additional private capital while mitigating the risks associated with early-stage climate technology businesses. Moreover, this blended finance approach directly addresses the chronic shortage of equity financing that often hinders the growth of promising climate ventures.

Notably, this catalytic investment aims to unlock $70 million in funding for African climate-focused ventures.

The ACV Fund will address the critical financing needs for early-stage climate technology entrepreneurs, focusing on high-potential ventures in key sectors, including solar energy solutions, energy efficiency technologies, electric mobility, agricultural technology, and circular economy innovations.

In addition, the initiative emphasizes supporting African entrepreneurs, particularly women-owned and -managed businesses.

Who says what:

Partner and chief legal officer at Persistent Energy Capital LLC, Wairimu Karanja, said the commitment reflects the AfDB’s confidence in our climate investing and in-depth Venture Building model in Sub-Saharan Africa.

“The ACV Fund invests financial and human capital in early-stage companies led by outstanding entrepreneurs and gender-aligned teams that can drive meaningful climate impact while achieving commercial scalability,” he said.

The manager of the Bank Group’s Renewable Energy Funds Division, which oversees SEFA, João Duarte Cunha, noted that Africa is at the forefront of both the climate crisis and the climate opportunity.

“We are keen to catalyze more risk and venture capital to support promising African technology start-ups developing commercial solutions to complex climate and development issues. We look forward to our partnership with Persistent as one of the more seasoned early-stage investors in the continent, with a strong track record in energy access and clean energy transition.” he further explained.

From 2019 to 2024, the AfDB has committed approximately $6 billion to energy projects across Africa.

The bank introduced the Programme to Promote Efficient Lighting Lamps (PPLEEF), an  initiative to advance energy efficiency and the bank’s first fully dedicated demand-side energy efficiency investment project.