Conducting studies and providing research outputs on finance tools supporting electricity infrastructure development in Africa

Africa’s Power System Continental Master Plan Support

By 2040, when the African Single Electricity Market (AfSEM) is expected to be operational, it’s estimated that electricity demand will either double or triple, depending on the estimates. However, interconnecting the power grids also poses some challenges and risks that need to be addressed. These include technical, economic, environmental and social issues. The Continental Master Plan (CMP) aims at facilitating the development of a stable and reliable inter-regional power systems network that can form the backbone of an African single electricity market.

Agence Française de Développement engaged our team to review the CMP’s infrastructure finance mechanisms, de-risking approaches, project acceleration units, and international best practices and tools. We directed part of our focus to exploring innovative financing tools, such as the use of electricity tokenization as an alternative to support power projects financing. Outputs of our work included a matrix for classifying projects according to bankability potential, innovative regional and continental infrastructure development finance mechanisms, innovative power purchase agreement creditworthiness enhancement mechanisms, and a practical operational guide for assessing and improving the bankability of projects.

By refining the CMP, Agence Française de Développement can improve how they empower communities across Africa to access reliable energy.