[AfDB-IFC-ARE session] Improving capacity for ESG compliance in the DRE sector

A recent AMAP scoping study highlighted that mini-grid developers struggle to meet ESG risk management and impact reporting requirements, posing a key sector challenge. This aligns with insights from the Alliance for Rural Electrification (ARE), which has noted growing calls to adapt ESG standards and reporting to the smaller scale and lower risk profile of DRE projects, along with a push for standardization.

To address these issues, SEFA’s AMAP Team, in collaboration with the AfDB’s E&S Safeguards & Compliance Department, developed a technical assistance and capacity-building initiative: “Development of Guidance Materials, Capacity Building Resources, and Training Activities for ESG Compliance in the African Mini-Grid Sector.” The key objectives include: (i) providing practical guidance for mini-grid developers to apply ESG standards, particularly the AfDB’s Integrated Safeguards System (ISS) and IFC Performance Standards (IFC PS); (ii) standardizing ESG compliance approaches; (iii) creating practical tools, templates, and resources; and (iv) enhancing capacity through training and technical assistance.

AfDB/SEFA, IFC, and ARE are supporting this initiative. IFC and ARE contributed to the design and will assist with stakeholder outreach, adoption of outputs, and communication. ARE, as the Industry Engagement Partner, will lead stakeholder engagement and outreach efforts. Their involvement is funded by IFC.

Session Objectives

• Launch the initiative: Introduce the activity, background, and ESG compliance challenges for mini-grid developers.

• Present the AfDB/SEFA-IFC-ARE partnership: Explain the collaboration’s purpose.

• Outline the program: Discuss key workstreams and expected outcomes.

• Panel discussion: Engage sector stakeholders on ESG compliance challenges, expectations, and barriers to standardization.

• Q&A session: Gather audience feedback on the initiative and proposed workstreams.