50MW Solar Farm - Kenya
$45M Investment | Operational
30MW Wind Project - Tanzania
$52M Investment | Under Construction
20MW Hydro Plant - Uganda
$23M Investment | Operational
The Challenge
The East Africa Development Fund sought to deploy capital into renewable energy projects across the region but faced significant obstacles. Individual projects were too small to attract institutional investors efficiently, regulatory frameworks varied across countries, and local developers lacked the financial sophistication to structure bankable deals.
Furthermore, international investors were hesitant to enter East African energy markets due to perceived political risks, currency volatility, and limited track records of successful exits. The fund needed a partner who could aggregate opportunities, structure risk-mitigated deals, and leverage international networks to secure competitive capital.
Key Obstacles:
- • Fragmented project pipeline with insufficient scale
- • Regulatory complexity across 3 jurisdictions
- • Limited access to competitively-priced international capital
- • Investor concerns about political and currency risk
EAIAG's Approach
Portfolio Aggregation Strategy
EAIAG identified and curated three complementary renewable energy projects (50MW solar in Kenya, 30MW wind in Tanzania, 20MW hydro in Uganda) to create a diversified 100MW portfolio. This aggregation achieved the scale and risk diversification required to attract institutional capital while maintaining strong returns.
Blended Finance Structuring
Designed a sophisticated capital structure combining $45M in senior debt from development finance institutions (DFC, EIB), $60M in commercial equity from European family offices and impact funds, and $15M in concessional funding to de-risk currency exposure. This structure achieved a 22% blended IRR while maintaining acceptable risk profiles for all investor classes.
International Investor Mobilization
Leveraged EAIAG's presence at Davos and Geneva Chamber of Commerce forums to conduct targeted investor roadshows. Presented the portfolio to 40+ institutional investors across Europe and North America, ultimately securing commitments from 8 investors including Swiss family offices, German impact funds, and Scandinavian pension funds.
Regulatory Navigation & Risk Mitigation
Coordinated with energy regulators, power purchase agreement counterparties, and government ministries across all three countries to secure necessary approvals and guarantees. Negotiated partial risk guarantees from MIGA and political risk insurance to address investor concerns about regulatory changes and currency convertibility.
Project Timeline
Initial Engagement
Q1 2022EAIAG engaged by East Africa Development Fund to structure renewable energy investment portfolio
Market Analysis
Q2 2022Comprehensive assessment of solar, wind, and hydro opportunities across Kenya, Tanzania, and Uganda
Capital Structuring
Q3 2022Designed blended finance structure combining DFI debt, commercial equity, and concessional funding
Investor Roadshow
Q4 2022Presented at Davos and Geneva forums, securing commitments from European family offices and impact funds
Financial Close
Q1 2023$120M portfolio finalized across 3 projects with 22% blended IRR target
Implementation
Q2-Q4 2023Projects under construction with EAIAG providing ongoing advisory and investor relations support
Portfolio Breakdown
50MW Solar Farm - Kenya
30MW Wind Project - Tanzania
20MW Hydro Plant - Uganda
Results & Impact
Financial Outcomes
- ✓$120M portfolio successfully closed in 18 months
- ✓22% blended IRR achieved, exceeding 18% target
- ✓First two projects operational and generating returns
- ✓Zero cost overruns or schedule delays
Development Impact
- ✓100MW of clean energy capacity added to regional grid
- ✓850+ direct and indirect jobs created
- ✓200,000+ tons CO2 emissions avoided annually
- ✓Power access extended to 150,000+ households
"This portfolio demonstrates that East African renewable energy can deliver competitive returns while creating significant development impact. EAIAG's ability to structure complex multi-country deals and mobilize international capital was essential to our success."
— Dr. James Kariuki, Investment Director, East Africa Development Fund