E3 Low Carbon Economy Fund IStatus: Approved investment
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Who is our customer
E3 Low Carbon Economy Fund I (“E3” or “the Fund”) is an investment fund that aims to invest in low carbon decentralized and smart services in Africa. The Fund is formally managed by Lion's Head Global Partners and advised by E3 Capital. FMO has participated in the Fund's first close alongside KFW, Swedfund and Proparco. The Fund is a successor to Energy Access Ventures Fund, to which FMO is a limited partner.
What is our funding objective?
E3 focusses on investing in early-stage companies with high growth potential and an innovative character. Their target companies should have the potential to generate significant economic returns, as well as improve access to basic needs (like energy) or the environmental sustainability of African economies.
Why do we fund this investment?
The Fund's mission aligns well with FMO's strategy to (i) reduce inequalities by providing access to basic goods and services to underserved populations, (ii) take climate action to reduce adverse environmental impact, and (ii) support tech (enabled) propositions designed for emerging markets that can significantly improve value chains and create new opportunities.
What is the Environmental and Social categorization rationale?
The Fund is assigned to "Category A" since approximately 30% of the portfolio will target infrastructure-type prospects (mini- and metro-grids; distributed energy systems). The mentioned deals may fall into E&S Category B+ due to the potential trigger of IFC PS 5-8 to a limited extent, combined with the challenging country contexts in Sub-Saharan Africa. The remaining 70% of the portfolio is intended for sectors with lower E&S risks: internet connectivity, electric mobility, agricultural appliances and productive use, energy efficiency enablers. Several investments will be located in fragile- and conflict affected situations where an increased sensitivity is required to identify and mitigate risks related to human rights abuses, weak land governance, risks of child labor and modern slavery, gender-based violence, security incidents and armed conflicts. Climate change vulnerability and inequalities further elevate contextual risks.
- Website customer/investment
- Publication date
- Effective date
- Total FMO financing
- USD 10.00 MLN
- Ventures Program Africa EurNb
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C)