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Funding structures available
These funding structures are available in the mini-grid space in primary and secondary tranches
Investor equity Debt Strategic Grants
• Angel investors and • DFIs offer concessional • Pension Fund • Most mini-grids rely on
venture capitalists (early loans which have Administration grants and subsidies for at
stage seed capital); significantly better terms • Insurance company least 30% of the investment
than market-based loans. costs. The grants are
• Private equity • Power Company
• Commercial banks are typically used for pilot
• HNIs /family offices projects, early stage
often risk averse and
(expansion capital); development costs, capital
reluctant to lend to mini-
• Impact investors (who look grids until their business investments and technical
for a social and financial models are proven and the assistance.
return); and main project risks are • Grants come from either
• Developers are required to mitigated. international development
contribute 20% – 30% • Debt refinancing loan by or local government
equity to the project Credit Guarantee Agency agencies, trusts and
financing foundations, private
individuals and others.
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