The Norwegian DFI will invest approximately €11.5m in the second social bond issuance from PEPT, helping to finance up to 400,000 new grid connections for low income households and small businesses.
Norfund, the Norwegian development finance institution (DFI), has backed Programme Electricité Pour Tous’ (PEPT) second social bond issuance in Côte d’Ivoire helping to connect low income households and small businesses across the country to the grid.
Norfund is one of several investors to back the bond totalling 60bn West African CFA francs (XOF), around €91m, which has been structured into three tranches and issued by the Fonds Commun de Titrisation de Créances Électricité Pour Tous (FCTC EPT), a local securitisation vehicle.
Norfund will invest approximately €11.5 million in tranche B, which offers an 8% interest rate and has a 10-year tenor, alongside Société Ivoirienne de Banque (SIB), which is investing an equivalent amount to complete the tranche. The latter is covered by a risk enhanced guarantee from the International Financial Corporation (IFC).
Norfund confirmed to Impact Investor that tranche A with a value of XOF 25bn will be covered by private investors mainly from Cote d’Ivoire and tranche C with a value of XOF 20bn, is being covered by the African Development Bank (AfDB) and The Emerging Africa & Asia Infrastructure Fund (EAAIF), with each organisation contributing XOF 10bn.
Victor Signes, senior associate -renewable energy at Norfund, told Impact Investor: “Our investment in tranche B addresses a gap, as it is challenging for private investors to commit to a 10-year bond at this pricing. This strengthens the additionality case for Norfund.”
As with the first issuance, the bonds will be listed on the Bourse Régionale des Valeurs Mobilières (BRVM) regional exchange, which EAAIF said would support West African capital markets and enable broader local investor participation, with pension funds, regional banks, and other financial institutions expected to participate in the senior tranches.
Energy access
The programme, which has facilitated over 2 million grid connections since its launch in 2014 aims to finance an additional 400,000 connections with the funds from this latest bond issuance in support of the country’s ambition to achieve universal electricity access by 2030.
“This programme aims to enhance living standards by providing electricity access to all households in Cote d’Ivoire, particularly focusing on low-income populations in underserved urban and rural areas,” said Signes, explaining that the programme would be implemented by CIE, the national electricity company and distributor in Cote d’Ivoire.
“Managed by CIE, PEPT offers an integrated connection service with a flexible payment scheme. Households pay a modest upfront fee and then repay the remaining connection cost through their electricity bills,” he explained.
Previously, the programme was funded by donor grants but in 2023, CIE initiated a securitisation programme through a social bond issuance to fund future connection costs, Signes said. The proceeds from these bonds are used to finance new connections, with customer repayments servicing the bonds. The first issuance was successfully closed in November 2023.
Outlook
Last month, the IEA’s World Energy Outlook 2025 revealed that around 730 million people still live without electricity, and nearly two billion rely on polluting cooking methods, demonstrating the lack of significant progress in closing, what the report’s authors describe as, ‘the huge gap in the provision of modern energy’.
The picture is even starker in sub-Saharan Africa, home to 80% of the world’s population still lacking access to electricity.
The World Bank and the African Development Bank (AfDB) Mission 300 initiative, aims to connect 300 million Africans to electricity by 2030.
Signes said that from Norfund’s perspective, the primary challenge in achieving universal electricity access in these regions is the scarcity of capital.
“Private investors are rare in this sector, and support from governmental or institutional bodies remains limited. The PEPT program, with its innovative funding mechanism through the issuance of social bond issuances, serves as a strong example of how to bridge this capital gap,” he said.
“This transaction has demonstrated the ability to attract diverse investors into a programme aimed at connecting low-income households to electricity nationwide while offering attractive returns,” he added.
