International Renewable Energy Agency (IRENA) and the Abu Dhabi Fund for Development (ADFD) have launched the fifth round of funding for renewable energy projects in developing countries.
The funding round of approximately $50 million is part of ADFD’s $350 million commitment to offer concessional loans to renewable energy projects endorsed by IRENA. The eligible projects for the funding include those from ocean energy, solar energy, wind energy, bioenergy, geothermal energy, and hydropower sectors.
Adnan Amin, IRENA’s General Director, said: “Many developing countries are blessed with abundant renewable energy resources, yet access to financing can still hinder development. IRENA’s partnership with ADFD helps overcome this challenge by offering concessional loans to quality renewable energy projects in developing countries, which then leverage additional investment.
“Funding from the facility helps boost renewable energy deployment and trigger economic growth, offering sustainable and affordable energy to people with limited or no access to electricity.”
The projects must be transformative, replicable, scalable and/or innovative, improve energy access and help address energy security issues.
Through this funding facility, ADFD provides concessional loans ranging from $5 million to $15 million per project. Finance is offered at 1 to 2% lending rates with a 20-year loan period, including a 5-year grace period.
Loans for each project cover up to half of the estimated project cost so additional co-financing must be acquired from other sources, according to IRENA.
IRENA said that more than 68MW of renewable energy capacity will be brought online, improving the livelihoods of 760,000 people, as a result of the first three funding cycles.
Applications for the funding will be accepted until February 15, 2017, and the results will be announced in January 2018.