BBOXX Rwanda, Kenya, and DRC

Project Description

This summary covers (i) equity and quasi-equity/shareholder loan investments by AIIF 3 Clean Energy, a Mauritius incorporated holding company owned by African Infrastructure Investment Fund 3 (AIIF3), which has made investment, through Beyond Energy Investments Limited, into three project enterprises in Rwanda, Kenya, and the Democratic Republic of the Congo (DRC); and (ii) a non-shareholder loan investment by FEI-OGEF LP, a Mauritius incorporated private debt fund managed by LHGP Asset Management, to the project enterprise in DRC. BBOXX is a vertically integrated off-grid solar company that provides solar home systems  (including a solar PV panel, printed circuit board,  and a battery), and on an facultative basis, compatible appliances (e.g. TV, radio, torch, shaver, refrigerator, satellite TV), to peri-urban and rural customers on a pay-as-you-go (PAYG) basis, utilizing mobile-money technology as the payment processing mechanism of the project enterprises. BBOXX aims to expand this model to an energy-as-a-service model by introducing a PAYG clean cooking solution which uses bottled liquefied petroleum gas (LPG) and small gas burners for domestic clean cooking. Overtime, BBOXX may also, on a limited scale and subject to further testing, offer additional services such as individual water storage tanks, wireless internet connections devices, or other consumer services to its customers. The proposed MIGA-covered projects will initially include the investments relating to the off-grid electricity and LPG services across Rwanda, Kenya, and DRC. MIGA may expand the scope of cover of the project to also include the additional services following a satisfactory review, in compliance with MIGA’s existing policies and procedures.

The proposed guarantees to AIIF 3 are of up to US$42.5 million and cover AIIF 3’s equity and quasi-equity/shareholder loan investments to BBOXX in Rwanda, Kenya and DRC, for a period of up to 15 years. The proposed guarantees to FEI-OGEF LP are of up to US$6.1 million and cover FEI-OGEF LP’s non-shareholder loan to BBOXX in DRC, for a period of up to 7 years. The guarantees would provide coverage against the risks of transfer restriction and inconvertibility, expropriation, and war and civil disturbance.

Under the Rwanda and DRC guarantees, MIGA’s exposure will be shared with the Private Sector Window (PSW) of IDA-18. For more information on PSW, please refer to the IDA-18 PSW website . PSW will participate in a first loss facility that will help spread the risk between MIGA and IDA, and reduce the cost of the guarantee for the project enterprises. The proposed PSW structure meets the minimum concessionality principle of IDA and the amount of subsidy is estimated to be less than 6.0% of the total project cost in DRC and less than 2.1% of the total project cost in Rwanda over the envisaged 15-year guarantee period.

Environmental Categorization

The projects are categorized as Category B according to MIGA’s Policy on Environmental and Social Sustainability (2013) The projects are expected to have limited site-specific environmental and social (E&S) impacts and risks. These impacts and risks can be avoided or mitigated by adhering to recognized Performance Standards (PSs), procedures, Environmental, Health and Safety (EHS) guidelines, and design criteria. Key E&S risks associated with this investment include: (i) corporate EHS management structure and systems; (ii) labor and working conditions including adequate occupational health and safety (OHS) and operational hazards related to transportation (at the community and worker level), installation and maintenance of the SHS kits and LPG cylinders; (iii) waste management (including e-waste); (iv) contractor management; (v) community health and safety along the transportation routes; and (vi) life, fire and safety and emergency response especially related to LPG cylinder transportation. The Environmental and Social Review Summary is available here .

Development Impact

Access to electricity remains low across sub-Saharan Africa with some 600 million people living without electricity on the continent. The project supports the national electrification targets of Rwanda, Kenya, and DRC where grid electrification in various regions is either unavailable, unreliable, or cost-prohibitive.  In this context, off-grid solar power generation solutions such as those provided by BBOXX enable household electrification using an environmentally and economically sustainable technology. The primary development impact of the project will be increased access to and reliability of electricity among underserved populations. BBOXX’s expansion into LPG delivery will support cleaner cooking initiatives with the potential for environmental and health benefits. Additionally, technicians will be employed and trained by the project enterprises (throughout the duration of the MIGA guarantee and beyond) to carry out installations and maintenance of the BBOXX products, thereby providing skilled employment opportunities in the host countries. Support for the project is consistent with MIGA’s strategic emphasis on low-income and fragile and conflict-affected countries and projects with climate benefits.