SIMA Commercial & Industrial Solar Green Bond

Debt : December 2023

BIO has granted a USD 10 M loan to the SIMA Commercial & Industrial Solar Green Bond, an impact driven fund with a focus on C&I projects in Africa

Amount

$ 10,000,000.00

Type of investment

Debt

Development impacts

Local economic growth
Private sector consolidation/innovation
Fight against climate change
Promotion of ESG best practices

Beneficiary locations

Africa: Kenya, Nigeria, South Africa

Investment field

Investment Companies & Funds

Activity

KK.64.301 Infra Fund

Organisation

SIMA Commercial & Industrial Solar Green Bond

Website

https://simafunds.com/commercial-and-industrial-solar-green-bond/

Domicile

The Netherlands

BIO, in partnership with Social Investment Managers and Advisors LLC (SIMA) and other financiers have reached the first close of the $150 million SIMA Commercial & Industrial Solar Green Bond which will finance small-scale productive-use solar projects throughout Africa.

The Green Bond will address the financing gap faced by local Commercial and Industrial (“C&I”) solar developers by providing flexible financing solutions across the C&I value chain. The Green Bond will target mid and smaller size C&I projects (< 5 MW) in productive use sectors with a focus on agriculture, horticulture, manufacturing, healthcare and education and operating in Africa.

Development impacts

Local economic growth
The Green Bond will support SMEs C&I developers in Africa by funding C&I Solar installations, providing reliable and affordable electricity (replacing diesel generators). It aims to create jobs, enhance business productivity, and foster sustainable development in the region.
Private sector consolidation/innovation
The Green Bond will invest in local SMEs with the objective to scale up the C&I industry, targeting small local developers.
Fight against climate change
The Green Bond is expected to provide financing for the installation of 220+MW solar C&I capacity in some of the poorest geographies, resulting in ~200k tons per annum of CO2 emissions reduction.
Promotion of ESG best practices
Promoting ESG best practises in the C&I industry as SIMA will enhance and adapt its ESMS to better address the specific E&S risks associated with C&I projects.

E&S Impact

An Environmental and Social Action plan (ESAP) was proposed by IFC, and adopted jointly by the investors group. This covers E&S training, E&S management system enhancements, solar supply chain provisions and requirements with regard to health & safety and climate risk assessment.

Situation at the time of investment

SIMA defined its E&S Policy and E&S Management System (ESMS) for the C&I Green Bond. These address the main risks associated with the solar sector. E&S champions within the Risk Management Team support their investment colleagues in implementing the ESMS and perform checks on compliance with the ESMS.

Risk Category: B