The second phase of the Renewable Energy and Climate Technologies in Sub-Saharan Africa Somalia program, simply known as REACT SSA Somalia program, is meant to support the development of Somali-based companies, more especially microfinance institutions that are commercially active in the renewable energy market, has been launched.
The program was launched by the Africa Enterprise Challenge Fund (AECF), a development institution that supports businesses to innovate, create jobs, leverage investments and markets in an effort to create resilience and sustainable incomes in rural and marginalized communities in Africa.
With a budget of about US$ 61M, the program is funded by the Swedish International Development Agency (SIDA), a government agency of the Swedish Ministry for Foreign Affairs responsible for the organization of the bulk of Sweden’s official development assistance to developing countries.
The objective of the REACT SSA Somalia program
Generally, the REACT SSA Somalia program aims to catalyze the private sector to increase the supply of cleaner fuels, raise awareness of the dangers of indoor air pollution, while promoting clean energy technologies.
It finances solar home systems, stand-alone solar systems for productive uses, green mini-grids, and clean fuels such as ethanol for cooking.
In Somalia, it will provide grants of between US$ 100,000 and US$ 1.5 million to commercially viable businesses, 25% of which will be owned or managed by women after the achievement of mutually agreed-upon milestones.
Inspiration for the private sector to invest and innovate in low-cost clean energy solutions
Victoria Sabula, AECF’s executive director says, “This initiative inspires private sector investment and innovation in low-cost clean energy solutions. The companies that will receive grants and technical assistance under this program must provide affordable, quality clean energy products and services that benefit low-income populations in rural and peri-urban areas, especially women.”
As part of its tender for the second phase of the REACT SSA program, the fund is strongly encouraging companies based in the Hirshabelle, South West, and Banadir regions, or strategically planning to invest there.