MICROCAPITAL BRIEF: Zola, EDF Harness Securitization to Expand Solar Energy in Côte d’Ivoire with Support from Credit Agricole CIB, Grameen Credit Agricole Foundation, Societe Generale, AfDB

Credit Agricole CIB (Corporate and Investment Bank), a member of the France-based Credit Agricole Group; the Luxembourg-based Grameen Credit Agricole (GCA) Foundation; and French investment firm NEoT Off-Grid Africa recently launched a securitization vehicle to enable Zola EDF Côte d’Ivoire to increase its sales of solar power systems to households that are not connected to traditional power grids. Zola EDF Côte d’Ivoire, which uses a pay-as-you-go model, will back customer receivables through a new securitization vehicle called NEoT Côte d’Ivoire. Societe Generale Côte d’Ivoire, a subsidiary of France-based Societe Generale, has lent the vehicle XOF 11.8 billion (USD 20 million), with guarantees from the African Development Bank and Credit Agricole CIB. GCA Foundation will oversee the project and evaluate its social and environmental impacts.

Zola EDF Côte d’Ivoire was founded in 2016 by Zola Electric, a Tanzanian firm that makes solar power systems, and Electricite de France (EDF), a France-based producer of carbon-free power plants. The customers of Zola EDF Côte d’Ivoire pay for power kits in installments over three years via mobile money services, with the option to adjust their payment amounts when their levels of income change. EDF provides energy services at 38,900 sites in Europe as well as Argentina, Brazil, China, the Ivory Coast, the US and Vietnam. Zola Electric, formerly known as M-Power, sells power systems in five countries in Africa.

NEoT Côte d’Ivoire is owned by NEoT Off-Grid Africa, which plans to place “hundreds of millions of euros” in renewable energy in Africa. The vehicle is co-managed by NEoT Off-Grid Africa; EDF; Meridium, a subsidiary of US-based industrial conglomerate General Electric; and the Mitsubishi Foundation of Japan.

Founded in 2004, Credit Agricole CIB specialises in capital markets transactions as well as investment and corporate banking. During 2019, the organization had net banking income of EUR 5.5 billion (USD 6 billion) from a total of EUR 132 billion (USD 144 billion) in assets under management. The organization employs 11,500 individuals, 44 percent of whom are women.

GCA Foundation was established in 2008 by Credit Agricole, a French retail bank, in partnership with Muhammad Yunus, the founder of Grameen Bank. The organization seeks to reduce poverty by providing funding and technical assistance to microfinance institutions and other social businesses. As of May 2020, GCA Foundation had commitments of EUR 98 million (USD 110 million) outstanding to 85 partners in 40 countries in Africa and Eurasia. These partners serve approximately 9 million customers, of whom 85 percent are women and 78 percent live in rural areas.

By Andrew Janni, Research Associate

Sources and Additional Resources

Press release from GCA Foundation
http://gca-foundation.org/news/access-to-energy-in-ivory-coast-credit-agricole-cib-and-grameen-credit-agricole-foundation-support-a-project-with-strong-social-and-environmental-impact

Press release from NEoT
https://www.linkedin.com/posts/neotcapital_neot-offgrid-africa-receivables-securitization-activity-6640538265436856321-xy0D/

Press release from Societe Generale
https://societegenerale.africa/en/societe-generale-africa/news/news-details/news/renewable-energy-rural-areas/

Zola Electric homepage
https://zolaelectric.com/

EDF homepage
https://www.edf.fr/

Credit Agricole CIB homepage
https://www.ca-cib.com/

GCA Foundation homepage
http://gca-foundation.org

Mitsubishi Foundation webpage
https://www.mitsubishi.com/en/csr/philanthropy/mitstubishifoundation/

GE homepage
https://www.ge.com/

AfDB homepage
https://www.afdb.org/