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This article first appeared in our COP28 issue of My Green Pod Magazine, published 30 November 2023. Click here to subscribe to our digital edition and get each issue delivered straight to your inbox
It’s widely acknowledged that bridging the climate funding gap for emerging economies is a critical step in the global race against climate change.
Developing countries often lack the financial resources needed to transition to more sustainable technologies and adapt to the effects of climate change.
Failure to address this funding gap threatens not only the wellbeing of people in these countries but also the global fight against climate change.
Bridging this funding gap can only be achieved through private-sector financing, in which crowdfunding plays an important role.
A decade ago, the idea that someone sitting at home in the UK could use their mobile phone to create an online account and make an investment to support a project in sub-Saharan Africa would have been almost unthinkable.
However, the success of UK impact investing platform Energise Africa has demonstrated that this is a reality that is steadily gaining traction.
Energise Africa enables UK retail investors to invest directly in organisations operating in emerging markets to build clean energy access for all and support climate-first projects.
Since launching in 2017, the platform has attracted a user base of over 4,750 everyday people who, by investing their money in socially and environmentally impactful companies operating in sub-Saharan Africa and other emerging economies, are playing an active part in helping rural communities and combating the challenges faced in these regions.
Many of the organisations that Energise Africa investors support bring access to clean energy to remote areas.
In doing so, they have helped provide access to life-changing clean, affordable electricity to over 865,000 people in low-income, off-grid households and prevented more than 591,263 tonnes of CO2 emissions from entering the atmosphere.
Energise Africa’s unique approach was recognised in 2021, when it was named a winner in the 2021 UN Global Climate Action Awards in the Financing for Climate Friendly Investment category.
Earlier this year, CEO Lisa Ashford was awarded an MBE for services to impact investing.
Energise Africa’s innovative blend of institutional and retail finance has contributed to its success.
This blended finance approach has seen public and philanthropic funds used to catalyse private-sector investment in businesses working to achieve SDGs in emerging markets.
Many of the projects that Energise Africa supports have received institutional financing from match funding and grant-giving organisations such as UKaid, Virgin Unite, Good Energies Foundation and P4G, allowing the achievement of overall public/private leverage ratios greater than 1:7.
Aptech Africa, a Uganda-based company that designs and installs solar energy systems and water pumps in South Sudan, Uganda, the Central African Republic, Sierra Leone, Niger and Liberia, is one of the pioneering organisations supported by Energise Africa investors.
Aptech recently raised finance to install mini-grids providing clean and reliable energy to two rural communities in Madagascar, as part of a project for UNDP.
The offers raised £620,000 to fund the upfront costs of building and installing the mini-grids, provide life-changing electricity access to these communities and cut carbon emissions by reducing reliance on fossil fuels.
Energise Africa investors have also provided vital funding to Bisedge, a ground-breaking green logistics business based in Nigeria that provides full outsourcing solutions to businesses, including the provision of electric forklift trucks.
With the finance from investors, Bisedge can buy more electric forklifts and rent them to its customers.
For every diesel forklift replaced by an electric forklift, Bisedge will save 124 tonnes of CO2 per year.
Each forklift also creates around four secure jobs, and Bisedge is targeting a 30% female workforce.
These organisations’ impact extends beyond climate action, as they are part of the larger SDG development ecosystem.
Investing in impactful businesses in emerging economies yields benefits such as economic advancement, gender equality, poverty eradication and improved health.
If you’re interested in learning more about Energise Africa, including opportunities for match-funding as an organisation, visit energiseafrica.com.
This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take two minutes to learn more here.
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