2 March 2020: NEoT Offgrid Africa (NOA) has closed a receivables securitization program with Zola Electricity Côte d'Ivoire (ZECI - a joint venture between EDF and Zola Electric) which aims to equip more than 100,000 households with solar home systems in Côte d'Ivoire, mainly in rural and peri-urban areas. NOA, majority-owned by Meridiam, is the first investment platform to set up a receivables securitization program in the financing of off-grid energy projects in Africa. Its objective for this deal is to reach a portfolio worth 40 million euros.
Through this innovative financing mechanism, NOA enables ZECI to focus on the commercialization and deployment of clean energy supply solutions in remote areas. With its securitization program, NOA bears financial risks related to the “rent-to-own” scheme whereby customers can become owners of the solar kits at the end of the rental period. In order to reach a mostly unbanked population, payments are made via a mobile money platform.
NOA is leading the financial structuring of the entire project. As part of this operation, NOA has mandated Crédit Agricole CIB (CACIB), Société Générale CIB and Société Générale Côte d'Ivoire (SGCI) to arrange the financing, whereby SGCI has extended a loan in local currency (XOF) whose committed amounts will vary monthly depending on the characteristics of the client portfolio. The loan is guaranteed by the African Development Bank (AfDB) and CACIB, while the Grameen Crédit Agricole Foundation will be in charge of monitoring the social and environmental performance of the project.
Solar energy is particularly suited to the African continent, being able to operate outside the transmission and distribution grids, thus making it possible to supply isolated households as well as entire cities. In its study "The Grid won't connect Africa but solar can", the consulting firm Kleos Advisory estimates that nearly 120 million households (approx. 600 million people) on the African continent do not have access to energy. With each household spending an average of $200 per year on energy services, the market for companies offering off-grid solar solutions for individuals is estimated at $24 billion.
“NEoT Offgrid Africa is really proud to have set up this first of a kind innovative financing scheme, stated Philippe Ringenbach, managing director of NEoT Capital. Financing needs for energy access in Africa are huge, but most of the times very challenging for private investors. This deal will surely position NOA as a key player for financing SHS and other off grid solutions (such as mini grids and C&I installations), enabling to provide much more energy access to people and industries in Africa.”
“We are delivering sustainable and resilient infrastructures and especially supporting energy transition and access to energy in Africa, as illustrated by the 15 projects we are developing, financing and managing on the continent, added Mathieu Peller, Meridiam COO Africa. With this project, led by NOA, we are contributing to the emergence of alternative financing methods and innovative solutions in the African energy sector, where demand, particularly in the offgrid sector, is very high.”
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About NEoT Offgrid Africa: NEoT Offgrid Africa (NOA) is an investment platform designed to support Africa's energy transition by addressing the issues of energy access and zero-emission mobility. Founded and owned by Meridiam (as majority shareholder), EDF and Mitsubishi Corporation, NOA provides its customers with innovative financing solutions to remove barriers to upstream investment, deployment of new technologies and commercial risk management. NOA is managed by NEoT Capital, which brings together a team experienced in financial structuring and clean energy solutions, and relies on international strategic partners to provide the financial and operational support needed to develop a carbon-free world.
About Meridiam: Meridiam is currently developing and financing 15 projects in Africa. All together amounting to more than EUR 3 billion of capital expenditures. Meridiam is strategic partner of 2020 Africa France Summit to be held in Bordeaux from 4 to 6 June 2020. Meridiam was founded in 2005 by Thierry Déau, with the belief that the alignment of interests between the public and private sector can provide critical solutions to the collective needs of communities. Meridiam is an independent investment Benefit Corporation within the meaning of French law. It specializes in the development, financing, and management of long-term and sustainable public infrastructure projects and assets in the three core sectors: mobility, energy transition and social infrastructure sectors. With offices in, Addis Ababa, Amman, Dakar, Istanbul, New York, Luxembourg, Paris, Toronto and Vienna, Meridiam currently manages 7 billion Euros of assets, and more than 75 projects and assets to date. Meridiam is certified ISO 9001: 2015, ISO 26000 Advanced by VigeoEiris and operates on a proprietary methodology in relation to ESG and impact based on UNSDGs.
