The Development Bank of Ethiopia will offer up to $20 million to private companies in efforts to accelerate development of renewable energy and energy efficient products.

The funds will be drawn from money granted to the country by the World Bank in May of last year, with a total of $ 40 million having been allotted to renewable energy development projects initiated in the private sector, reports the Addis Fortune.

The first sum of $20 million is intended to spark activity in the renewable energy sector by attracting industry players and investors to get involved.  Funds will be released over the course of the coming five months – with the Development Bank currently in discussions with interested parties.  The Bank is also still collaborating with the World Bank in order to finalise conditions – such as interest levels – for the provision of funding to private companies.

Dependent on the success of initial projects implemented by the private-sector players, a further $20 million may be distributed to private companies according to sources, reports the Fortune.

The World Bank and Ethiopia’s Ministry of Finance and Economic Development finalised a funding agreement last year, pursuant to which the Bank will provide the country with up to $200 million in order to enhance the energy sector.  The main focus of projects to be funded will be to establish stable electricity distribution across the country.