Dutch Agency Funds E+Co With $6.6M Investment
Tuesday, December 8, 2009
FMO, the entrepreneurial development bank of the Netherlands, has created a clean energy investment facility to be managed by E+Co. FMO has set aside USD 6,650,000, funded by FMO’s Access to Energy Fund. Funding also includes a capacity development facility for entrepreneurs in the amount of EUR 500,000. The FMO-E+Co agreement is the result of intensive cooperation over the last year and reflects both organizations’ goals to create a sustainable market place for access to clean energy that will reduce the impact of climate change and will alleviate poverty.
“FMO firmly believes that access to energy is essential to improving living standards. We focus on increasing the number of people with access to energy from sustainable sources, energy which is provided by local private enterprises,” says Huub Cornelissen, Director Energy and Housing at FMO. “E+Co has a proven track record in clean energy development along the value chain, and we are confident it will be a strong partner in our efforts to increase energy access in developing countries. This partnership with E+Co allows FMO to access the SME market for clean energy related solutions. We expect that 60% of the funding will be invested in Sub-Saharan markets.”
Building on more than 15 years of clean and modern energy investing in Africa, Asia and Latin America, E+Co will invest the FMO funds through its market-based, enterprise-centric business model. E+Co works with local entrepreneurs, providing business development services and investment capital to create and sustain enterprises that provide energy services. Their clients, often located in rural and peri-urban areas, are households, businesses and communities in some of the toughest markets in the world. E+Co’s current investment portfolio includes over 150 active energy SMEs ranging from micro-hydro developers in Nepal to solar retailers in Nicaragua and efficient cookstove manufacturers in Ghana. Collectively, E+Co’s investees have provided access to clean energy to over 5.6 million people around the world.
In addition to investing, E+Co also provides individualized capacity building services to clean energy entrepreneurs. These services include initial market assessments, financial modeling and expansion planning. The goal is to both increase entrepreneurial capacity at the local level and, at the same time, to mitigate the risks associated with energy investments in small and growing businesses.
“E+Co’s core premise is that there is a demand for clean and affordable energy in developing countries, and this demand can be satisfied by local entrepreneurs,” says Director of E+Co Europe, Paul van Aalst. “The FMO investment facility will enable E+Co to provide much needed financing and support to local energy entrepreneurs. We envision a long and successful partnership as we jointly work to bring clean energy to the 1.6 billion people that haven’t yet seen a light bulb or cooked without firewood, and in the process, reduce the impact of climate change and poverty in the developing world.”