Solar Project Debt Financing in Africa
We act as arranger and debt advisor for utility-scale IPPs, C&I rooftop and ground-mount portfolios, and mini-grids across Africa. The mandate covers underwriting, lender soundings, term sheet negotiation, and closing management with counsel. We focus on structures that clear credit committees and wire funds.
Snapshot:
Senior and mezzanine debt, DFI participation, ECA cover for equipment, construction and VAT bridges, mini-perm with balloon, and portfolio holdco facilities. Typical timeline 12 to 24 weeks from complete data and cleared payment to signed term sheet. Financial close depends on permits and CPs.
Where we add value
Utility-scale IPP
Grid-tied solar PV 10 to 200 MWp with single offtaker under long-term PPA. Hybrid with BESS where needed for firmness.
C&I portfolios
Multi-site rooftop and ground-mount under standard form PPAs with creditworthy corporates. Warehouse to term facility.
Mini-grids
Rural or remote systems with grants and results-based financing blended with debt. Paygo and tariff design matter.
Hybrid solar plus storage
PV with BESS for peak shaving, capacity payments, or grid stability. Revenue stacking and reserve sizing are key.
Debt products we arrange
Senior project finance |
15 to 18 year tenors where tariff and country allow. Amortizing after grace. DSCR sized on P50 with P90 checks. |
Mini-perm |
5 to 7 year term with balloon. Take-out by DFI, bond, or local bank once operations stabilize. |
Construction and VAT bridge |
Drawn during EPC with interest capitalized. Repaid at term conversion or VAT reclaim. |
Mezzanine or holdco debt |
Cash pay with PIK toggle when coverage is tight. Used for equity top-up and portfolio growth. |
ECA-backed buyer credit |
Tenors linked to OECD rules. Covers eligible equipment and services from supplier countries. |
Portfolio warehouses |
Revolving line to aggregate C&I PPAs, then term out once a size and seasoning threshold is met. |
What makes a solar project bankable in Africa
Offtaker and PPA |
Creditworthy utility or corporate, take-or-pay terms, curtailment rules, change in law protection, and payment security such as LC or escrow. |
Sovereign and political risk |
Partial risk guarantees, PRI, or DFI participation. Clear step-in rights and termination payment formulas. |
Currency |
Hard currency tariff or indexed local tariff. Hedging plan for conversion and transfer risk. |
Permits and land |
Land rights secured, EIA approved, interconnection studies complete, and grid letters in place. |
EPC and O&M |
Tier-one modules and inverters, bankable EPC with LDs and performance guarantees, clear O&M KPIs. |
Financial metrics |
Base case DSCR at or above threshold with P90 check, DSRA sized, and sensible reserve policies. |
Security package and controls
- Share pledge over project SPV and holdco where applicable
- All-assets debenture or local charge filings on plant, machinery, and receivables
- Assignment of PPA, EPC, O&M, interconnection, and insurance proceeds
- Accounts structure with waterfall and DSRA
- Insurance with lender endorsements and reinsurance where required
Who we approach
DFIs and MDBs, ECAs, specialist private credit funds, yield-focused investors, and selected local banks. Targets are filtered by country, currency, ticket size, technology, and tolerance for construction or merchant exposure.
Process and timeline
- Intake:
Submit sponsor details, project summary, permits status, PPA draft, and model.
- KYC:
Sponsor and SPV screening. Invoice issued after preliminary clearance.
- Underwriting:
Credit memo, model checks, risk mitigants, and CP checklist. First pass in 10 to 15 business days after full documents and cleared payment.
- Soundings:
Soft outreach to test appetite and term ranges before full distribution.
- Distribution:
Staged send to lenders that match country and structure.
- Term sheet:
Negotiate covenants, reserve policies, guarantees, and CPs. Expect 12 to 24 weeks from complete data to signed term sheet.
- Financial close:
Final diligence, opinions, filings, and conditions precedent to funding.
Documentation checklist
Item |
Details |
Financial model |
Integrated model with sources and uses, DSCR, sensitivities, and reserve sizing. |
PPA and offtaker files |
Signed or near-final PPA, offtaker financials, payment security terms. |
Permits and land |
EIA, land rights, grid studies, and interconnection approvals. |
EPC and O&M |
Draft contracts, performance guarantees, liquidated damages, and warranties. |
Insurance schedule |
Construction and operational covers with endorsements. |
Corporate approvals |
Board minutes, shareholder resolutions, and SPV structure. |
KYC |
Sponsor identity, source of funds, sanctions screening. |
Mandate and fees
Underwriting fee |
From $45,000 to $165,000 based on ticket size and complexity. Invoices issued after KYC. |
Success fee |
2.0% to 3.0% of funded debt. Minimums apply. |
Third-party costs |
Client pays legal, technical advisor, insurance broker, valuations, and filings. |
Refunds |
Fees are non-refundable once underwriting begins. |
FAQ
Can you finance before the PPA is signed
We can start underwriting and soundings. Binding term sheets need a signed or near-final PPA and clear payment security.
Will lenders take merchant risk
Some will at low gearing with strong reserves and hedges. Most prefer contracted cash flows.
What equity do sponsors need
20% to 30% of EPC and soft costs, committed and staged. Grants can reduce the cash ask if ring-fenced.
Start your onboarding
Submit your intake form. After KYC, your invoice will be issued. Underwriting starts when payment clears.
Submit Intake Form
We are an arranger and advisor. We are not a lender and do not guarantee funding. All mandates are best efforts and subject to underwriting and compliance. Pay only to bank details on our official invoice. Be careful with unsolicited offers through unofficial channels.