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Frontier Energy II announces first close with $116m commitments

Anna Lyudvig
May 16, 2017, midnight

Word count: 364

Frontier Energy II, an investment fund focused on developing, constructing and operating renewable energy projects in Sub-Saharan Africa, has achieved its first closing at $116m.

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Frontier Energy II, an investment fund focused on developing, constructing and operating renewable energy projects in Sub-Saharan Africa, has achieved its first closing at $116m.

The Fund received commitments from a combination of private investors and the following development finance institutions: CDC Group, GEEREF (EIB Group), FMO, Proparco, Swedfund, and the Development Bank of Austria (OeEB).

The Fund is open for second close investors until early 2018 with a target size of $200m.

According to Anna Ryott, Managing Director at Swedfund, Sweden’s development finance institution committed $13m to Frontier Energy II.

“Swedfund is committed to being a progressive climate investor and to help fulfil the Swedish Government’s ambitions to support green and inclusive growth in developing countries. We are excited about enabling the expansion of renewable energy in Sub-Saharan Africa by investing in the Frontier fund,” she said.

Frontier Energy II is a successor fund to DI Frontier Market Energy & Carbon Fund, a €60m fund established in 2011. 

DI Frontier Market Energy & Carbon Fund has invested in a broad portfolio of renewable energy projects that are now under development, construction, and operation in East Africa. 

The first fund is fully committed to six investments totaling 139 MW within hydro, solar and geothermal in East Africa. 

The new fund starts with a portfolio of 20 projects in East Africa under development, totaling 448 MW within hydro, solar, geothermal and wind.

Countries in the region have material deficits in terms of electricity production capacity, coupled with a substantial level of unused potential renewable resources. 

A competitive relative cost position underpins the attractiveness of new renewable energy investments, while these investments also help advance a socially and environmentally sustainable growth pattern.

Frontier Energy II will build on - and benefit from - the experience, portfolio and market position established during the last six years by the fund manager, Frontier Investment Management.

The fund manager and the investment funds under management are incorporated in Denmark with main offices in Copenhagen and Nairobi, and project offices in Nairobi, Kampala, Kigali, and Dar Es Salaam. 

Frontier Investment Management is characterized by an integrated hands-on approach to project development, financing, construction and operation.

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