This report examines the potential macroeconomic and welfare impact of the Africa Energy Guarantee Facility (AEGF), including improved viability of energy projects and enhanced electricity access. The report also reviews three case studies of guarantee use for energy projects in the region, and outlines several major reasons why investors are less likely to adopt investment insurance as a financing instrument. In addition, the study reviews empirical literature on the impact of risk mitigation instruments on access to finance, aiming to determine how the AEGF will likely influence access to finance for energy investors in the region. This research has been performed under the EIB-GDN Programme in Applied Development Finance. Launched in 2017, the programme lasted for three cycles of twelve-months, during which talented researchers from ACP countries spent a year on a “deep dive” study of an IFE project, trained, guided and mentored by GDN, the EIB and expert advisors (EAs). The programme used academic research techniques to study the development impact of ongoing private-sector investments, built capacity for evaluative research in developing countries, and helped to boost the EIB’s accountability and development effectiveness.

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