The Spark+ Africa Fund, which is an impact investment fund focused on financing the value chains of clean and modern cooking appliances and fuels to make them available to more people across sub-Saharan Africa, has raised more than $40-million in a first close.

Clean cooking businesses face many challenges, including limited access to investment capital to increase their production and distribution capacity, high risk perception and an insufficient return profile to attract commercial investment.

Spark+ directly responds to these challenges and is a key component of development finance institution the African Development Bank’s (AfDB's) actions in the area of clean cooking.

Spark+ Africa Fund will make debt, mezzanine and equity investments in companies that manufacture and distribute clean cooking solutions, such as biomass stoves, advanced biomass fuels, liquefied petroleum gas, ethanol and biogas systems.

Spark+ will also invest in distributors and consumer finance providers, such as off-grid solar companies and microfinance institutions that extend their services to clean cooking products.

“Access to reliable and affordable energy remains an aspiration for many Africans. While Africa has made strides towards increasing electricity access over the last decade, there has been less progress on access to clean cooking solutions.

"Close to 900-million people in sub-Saharan Africa still lack access to modern energy services for cooking, with negative impacts on health, especially for women and children and the environment,” the AfDB says.

Spark+ is anchored by the AfDB, using resources from the Sustainable Energy Fund for Africa (SEFA). SEFA is managed by the AfDB.

“SEFA’s anchor investment in the Fund’s first-loss tranche contributed to catalysing the participation of additional financiers in Spark+. We are pleased that the fund has been established as its investments are expected to support the delivery of clean cooking solutions to more than ten-million people across sub-Saharan Africa, with significant benefits for public health, gender equality, the environment and climate,” AfDB Renewable Energy & Energy Efficiency acting director Dr Daniel Schroth says.

The Spark+ Africa Fund was launched by its Switzerland-based investment advisory Enabling Qapital and Netherlands-based foundation Stichting Modern Cooking.

“We are grateful for the catalytic role that the African Development Bank and SEFA have played in launching Spark+. Access to clean and modern cooking solutions is an underappreciated component of infrastructure, with a major impact on the health and well-being of hundreds of millions of people, and in particular women, on the continent,” says Spark+ co-investment director and Stichting Modern Cooking chairperson Peter George.

Besides the AfDB, the Spark+ Africa Fund is supported by more than a dozen investors, including governments, foundations and financial institutions. The Clean Cooking Alliance, an initiative of the United Nations Foundation and its donors, including the Norwegian and Dutch governments and the AfDB, supported the development of Spark+. The fund has a target size of $70-million.

“The support from SEFA and the AfDB are key and timely to finance an essential segment of the access to energy space with a significant impact on people’s lives and our planet.

"Spark+ will offer tailored investment instruments throughout the value chain, from innovative design and manufacturing companies to last-mile distributors, in order to further the outreach of clean cooking solutions in sub-Saharan Africa,” said Spark+ co-investment director and Enabling Qapital managing partner Xavier Pierluca.