DEG – Deutsche Investitions- und Entwicklungsgesellschaft, the German development finance institution, has announced a €30 million loan commitment to the Africa Go Green Fund (AGG), a climate-focused investment vehicle managed by Cygnum Capital, which invests in projects in Sub-Saharan Africa that reduce greenhouse gas emissions. The financing aims to scale commercially viable solutions that reduce greenhouse gas emissions and improve energy efficiency across the continent.
Africa faces a significant climate investment gap, particularly in sectors such as energy efficiency, clean cooking, electric mobility, green buildings, and distributed renewable energy solutions. These industries often struggle to access traditional financing due to their unique requirements—such as longer asset lifecycles, irregular cash-flow patterns, and evolving regulatory frameworks. AGG was created to bridge this gap, offering flexible medium- to long-term debt structures tailored to the needs of climate-focused business models.
Africa Go Green Fund (AGG) was initiated by KfW on behalf of the German government to promote private investments that mitigate or reduce the emission of Green House Gases (GHG). The objective of the fund is to spur additional GHG reductions by encouraging corporate and industrial entities, local financial institutions and other businesses which are developing and/or investing in eligible Energy Efficiency & Renewable Energy projects by providing medium and long-term debt, mezzanine financing, and guarantees as well as technical assistance aimed at maximizing learning-by-doing opportunities, facilitating deals and encouraging the long-term sustainability of the EE/RE market in the Target Region.
Gudrun Busch, Senior Director at DEG, emphasized the strategic importance of the investment:
Our commitment to the Africa Go Green Fund underscores DEG’s dedication to advancing climate-friendly and energy-efficient solutions across Africa. By partnering with AGG, we aim to close the financing gap for innovative businesses that deliver measurable climate impact while driving sustainable economic growth. Tailored debt financing is essential to unlock Africa’s energy transition.
Laurene Aigrain, Managing Director of Cygnum Capital, welcomed the partnership:
DEG’s support is a strong endorsement of AGG’s mission and strategy. It reflects the growing recognition that debt funds focused on energy efficiency and low-carbon technologies are critical to Africa’s energy transition. This investment strengthens our ability to deploy structured debt solutions into high-impact sectors where financing constraints remain acute despite strong commercial and climate fundamentals.
The collaboration between DEG and Africa Go Green Fund (AGG) represents a significant step toward mobilizing capital for Africa’s green economy, ensuring that businesses driving climate innovation have access to the financing they need to scale.
