Southern African Renewable Energy Investment and Growth Programme

The SOARING project was launched in 2019 to design and implement a prototype approach to prepare, bundle, and structure investments into small and medium-sized clean energy projects in Zambia and Tanzania. 
 
SOARING aims to establish a sustainable climate finance catalyst programme for SMEs and support countries in mobilising and channelling climate and private finance to achieve their NDCs and SDG (7) goals. The project assesses various essential aspects of supporting SMEs, including supply, demand, framework conditions for several SME-level clean energy alternatives in agricultural value chains, and off-grid power provision for rural and peri-urban areas.

The implementation partners for SOARING are RENAC and the Renewable Energy and Energy Efficiency Partnership (REEEP). SOARING is funded and commissioned by the International Climate Initiative (IKI) of the Federal Ministry for the Environment (BMU) Germany. Partner institutions are the Ministry of Energy, Tanzania and the Ministry of Finance, Zambia.  

The Soaring programme

The SOARING programme is aiming to comprehensively address market barriers national development banks and local financial institutions are facing in financing clean energy projects and businesses. SOARING aims to achieve this through providing credit enhancement instruments to participating financial institutions, as well as targeted capacity buildings/trainings on clean energy/climate finance and support in the origination of a clean energy pipeline to access funding.

While the combined financing requirements of Southern African SMEs are huge, their individual asks are far too small for existing climate finance instruments, and for most investors.
 
Using innovative technology and data-driven approaches and financial incentives provided by the SOARING Fund, combined with peer-to-peer learning and capacity building for government, financiers and the private sector, SOARING aims to help the pilot countries build an improved financial ecosystem for large-scale blended private/climate investment into clean energy off-grid and/or agricultural sectors at SME level.

The project will put mechanisms into practice to support climate-friendly strategies for SME growth and mobilise financing into SME-level project investments at scale. The underlying methodologies will be standardised and potentially replicable in other economic sectors or countries in which SMEs lack access to finance.  Capacity development will foster a pipeline of bankable, climate friendly and SME-led project investments, thus contributing to the African Renewable Energy Initiative (AREI) and leading ultimately to measurable emissions reductions.

SOARING will apply results-based financing measures to test blended financing approaches with SMEs, while gathering data and evidence on business performance and local socioeconomic impacts. It will establish a dedicated stakeholder forum to coordinate activities and promote synergies among different actors to help avoid duplication of effort and amplify learning in target geographies.

SOARING will utilise tailored outreach, training and technical assistance to build capacity among primary stakeholders - project developers, public financiers, commercial banks, other private investors, and government agencies – for sustainability.

The learnings from this pilot will be packaged in a number of ‘SME Climate Finance Pathways’, which will facilitate replication of the project’s achievements in other sectors and in other countries.