The Overseas Private Investment Corporation (OPIC) has made an initial investment into SunFunder’s $85 million (~₹6.04 billion) Solar Energy Transformation Fund. The fund supports electricity access through the use of solar power in Sub-Saharan Africa and India.

The financing is part of a $25 million commitment of senior and junior debt that OPIC had entered back in September 2018. Mercom had reported then that the OPIC commitment would help catalyze other impact-focused investors to achieve a target fund size of $85 million.

Since OPIC has committed to the financing, Calvert Impact Capital and Ceniarth have also committed $7.5 million (~₹533.54 million) and $5 million (~₹355.69 million) loans respectively. The IKEA Foundation has also provided a grant of $5 million (~₹355.69 million) as catalytic capital for the fund, bringing the total raised to $42.5 million.

“This project will advance OPIC’s mission of empowering people in some of the world’s poorest countries by bringing affordable electricity to remote areas that are not connected to an electricity grid. As we have seen from the additional financing raised, it is also a testament to OPIC’s ability to mobilize additional investment,” said Ray W. Washburne, President and CEO of OPIC.

According to estimates, the Solar Energy Transformation Fund is expected to improve energy access for three million people and mitigate 480,000 tons of carbon emissions annually over the nine-year life of the fund.

“SunFunder has now closed over $100 million (~₹7.11 billion) in diversified solar debt funds, and the Solar Energy Transformation Fund opens up new opportunities. As our largest fund and with a 9-year tenor, the Solar Energy Transformation Fund increases both the range and size of debt capital offerings that we can provide, especially for productive use solutions and commercial projects,” said Ryan Levinson, SunFunder founder and CEO.

SunFunder projects that the Solar Energy Transformation Fund will make individual loans to more than 50 off-grid solar companies.

The Solar Energy Transformation Fund is managed by SunFunder, a solar energy finance business working to make off-grid solar lighting and energy solutions more widely available in developing countries.

According to the press release, SunFunder has deployed $65 million of debt financing to 46 solar borrowers in Africa and Asia.

In November 2018, OPIC provided 600 million shillings (~$5.86 million) to CrossBoundary Energy, a Nairobi-based company which funds commercial and industrial solar in East Africa.

In June 2018, OPIC signed a $5 million loan guarantee with India’s IndusInd Bank. The money will support Grameen Impact, a non-bank financial institution backed by Grameen Capital India in its focus on the growth of local small and medium enterprises.