Regional/ Local renewable energy expert_Capacity Development for Local Financiers in Rwanda

Mobilising private investments in decentralised renewable energy is key for realising the Sustainable Development Goals (SDGs) and the Paris Agreement. Also, lowering barriers for financing for renewable energy is an important steppingstone to build back better after the current COVID-19 crisis. RE technologies have become increasingly commercially viable and are the least expensive and most feasible option to provide millions of people with clean and affordable energy. Linking project and business development with financing –and thereby accelerating the process –is however a persistent challenge. Project and business developers often do not speak the same language as financiers. Substantial funding is available, although not necessarily at the right time and through the right channels: when investing in or financing renewable energy, barriers arise mainly from the combination of a mismatch between the required investment size and the traditional debt and equity offerings, a long repayment period, little collateral availability, weaknesses and limited capacities on the side of investees and often limited knowledge of the RE technologies in the financing institutions. For many local financiers, these factors –especially  when  combined –lead  to  a  high  perceived  riskandresult  in limited investments in RE projects.

In  Rwanda, strong  electrification  endeavours  by  the  government  in  the  last  years  have  increased  grid  extensions,  off-grid  access  as  well  as  grid  access  for  public  institutions. In  its economic  recovery  plan,  the  Government  of  Rwanda  has  stressed  again  the  importance  of energy access and electrification by doubling the electrification investment. Rwanda was chosen as a pilot country for this project to support these endeavours by increasing knowledge and capacities on renewable energy in the local financial sector.

The  objective  of the  pilot  initiative is  bringing  decentral  renewable  energy projects and  the financial sector in Rwanda closer together by increasing the understanding of risks and mitigants and addressing specific coaching and training needs in the financial sector.