Highlights

In 2024 AEF contracted a total of €17 million in new commitments. In addition, AEF also supported several projects with technical assistance contributions. 

During the year there have been close interactions between the Ministry of Foreign Affairs and FMO to update the AEF grant agreement. Both parties wished to align the various grant agreements (MASSIF, BP, and AEF) provided by the Ministry to FMO. The changes do not affect the mandate or the size of the Access to Energy Fund, nor will it have implications for the clients. We thank the Ministry for the constructive discussions and look forward to our continued cooperation. At the same time, the Ministry disbursed €9.1 million to FMO under the existing grant agreement.  

AEF experienced some further deterioration in the portfolio. Some of this was due to macro-economic challenges in countries such as Madagascar, Mali, Burkina Faso. FMO also had to write off the loan to C-Quest Capital, a clean cooking company active in several countries, amongst which some Least Developed Countries (LDCs) like Malawi. The effect is that for the 3rd year in a row, AEF is loss-making, reducing the revolvability percentage to 98.8%, considerably lower than the 107.6% per end of 2023. 

It is good to realize that the losses in recent years have been partly the result of investments in high-risk, high-impact sectors such as clean cooking and solar home systems. It has proven difficult for the off-grid sector to find the right balance between economic viability, scaling of the sector and the high-impact nature of these investments. FMO is currently evaluating what the next steps could be to continue supporting this important sector that allow low-income, rural populations access to a renewable and sustainable energy source.

FMO is proud to have contracted a new transaction with Hydrobox in 2024. A $7 million loan will be used to finance a portfolio of micro hydro-power plants and mini-grids in rural Kenya. Hydrobox will sell electricity under a so-called Anchor, Business & Household Customer (“ABC”) model, where ~70% of the generation will be sold to commercial and industrial (“C&I”) clients and the remainder to small businesses and households. The goal is to connect people and businesses to a grid that have previously never enjoyed access to any, or reliable, energy, improving their livelihoods and supporting sustainable business. Hydrobox also partners with different organizations to offer additional services that benefit the communities, creating more impact while diversifying revenue. These services include lease-to-own appliances to promote productive use of electricity and business incubation support. 

Following on to the existing Ventures Program (“FVP 1.0”) for which AEF has provided part of the funding, Ventures 2.0 (FVP2), the new FMO Ventures Program, has gone live in October 2024 denoting another $200 million program to be invested over 5 years in early-stage startup or scale-up companies with a tech component in the sectors of FinTech, AgriTech and CleanTech. AEF has agreed to a €10 million contribution overall to FVP2, expected to be deployed. MASSIF and Building Prospects also contribute to FVP2 funding.

In 2018, AEF provided equity to Scatec in Ukraine, for the construction of a utility scale solar plant. The plant’s operations started in December 2020. Unfortunately, since the war, the plant’s productivity has decreased due to curtailments, as a result of damage to the national grid. At the time of writing, the project has no war damage, the project region is quiet, and some 400km from the warfront. Also, the Ukrainian hryvnia (UAH) cannot be converted to hard currency anymore. In 2024, AEF assisted Scatec with an €125,000 Development Contribution (grant). The war has resulted in the mobilization of many male specialists, particularly in critical sectors such as electro-technical fields, as they are drafted into the armed forces. This sudden loss of skilled labor has created a significant gap in the workforce, posing a key risk to the continuous operation of energy plants and the overall energy infrastructure. Scatec addresses the shortage of electro-technical specialists by focusing on training and certifying women to fill these essential roles. By equipping women with the technical and managerial skills required to work in energy production and infrastructure management, the project not only ensures operational continuity but also promotes the economic empowerment of women in Ukraine.  

We look forward to engaging with new and existing clients again in 2025 and continue supporting AEF’s purpose by providing reliable energy access for those who are currently unconnected and improving their livelihood as a result. 

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