The United Nations launched the photovoltaic solar innovation plan
According to media reports, the Climate Aggregation Platform (CAP) of the United Nations Development Programme (UNDP) has launched an innovative program for off-grid photovoltaic financing aimed at increasing the supply of electricity in developing countries, mainly in Africa. The first edition of the program, titled the Climate Aggregation Platform (CAP) Financial Innovation Challenge, will be implemented primarily in the East African region.
The Climate Aggregation Platform (CAP) Financial Innovation Challenge aims to develop innovative financial aggregation structures and models to help increase energy availability in developing countries and reduce the cost of clean energy financing. The competition launched will provide a $40,000 prize to successful applicants to develop innovative technologies and solutions developed by the project.
Financial aggregation is a method of bundling multiple energy assets, projects or companies into an investment portfolio and then obtaining funds from investors based on future cash flows. This reduces transaction costs and risks for investors, while removing investment barriers, opening up new financing channels for the development of small-scale renewable energy projects.
And developing countries need new sources of finance and financing mechanisms to close the investment gap in order to achieve the Sustainable Development Goal of universal access to clean, affordable and reliable energy for all by 2030. A recent report by the United Nations Development Programme and Climate Bonds suggests that the potential for financial aggregation of small-scale renewable energy investments remains untapped.
Eduardo Appleyard, Project Coordinator for the Development of the Climate Aggregation Platform (CAP) said: “While the market is still in its infancy, financial aggregation may one day be a game-changer for distributed renewable energy companies. Through the Climate Aggregation Platform (CAP) Financial Innovation Challenge Competition , we hope to support the development of innovative solutions that may close financially close transactions in the near future, eventually scale, and be replicated.”
The Climate Aggregation Platform (CAP) Financial Innovation Challenge Competition will facilitate the transfer of know-how and innovative solutions that will help overcome energy challenges faced by African countries through the installation of photovoltaic systems. According to the United Nations Development Programme, off-grid photovoltaic microgrids are key facilities for delivering reliable power to underserved communities without access to electricity or areas with unreliable grids.
Funded by the Global Environment Facility (GEF), the Climate Aggregation Platform (CAP) initiative will select more than five projects in the East African region. This includes the deployment of more than one project each in Rwanda and Uganda. The deadline for the competition is 12 noon on August 31st.
The competition will be led by “sell-side” participants such as project owners and energy developers, but also open to “buy-side” participants including impact investors, development banks, crowdfunding platforms and more. The Climate Aggregation Platform (CAP) also offers this engagement opportunity to civil society organisations, NGOs, research institutes, consultancies and credit raisers.