Kenya-based Solarise Africa has attracted three financiers in a Series B funding round totaling US$10 million. French development financial institution Proparco became the latest entrant in the company’s fund mobilization activities, joining existing investors Belgian non-profit the European Development Finance Institution (EDFI), Germany-based Energy Access Ventures (EAV) and EU-funded impact investment facility, ElectriFI. The goal is to expand Solarise’s distribution of clean energy in Africa.
Talking to pv magazine about the latest investment, CEO Jan Albert Valk said the funds will be put towards helping more SMEs gain access to solar PV projects. The company, established in 2017, is currently active in Kenya, Rwanda and South Africa, so all upcoming work will primarily be focused on these three counties.
However, Solarise’s ultimate goal is to provide solutions – in the form of power purchase agreements (PPAs) or leasing equipment – across the continent. Valk is looking to mobilize more funds within six months to a year, to enter other countries including Nigeria, Ghana, Uganda, Nigeria and Burkina Faso. More “difficult” territories, such as DR Congo, Chad and Sierra Leone, are also being targeted.
Most projects Solarise supports are rooftop and ground mounted PV systems, often with storage elements, between 50 kW to 3 MW in size. A number have already been completed, like the 850kWp Nakuru plant in Kenya, while others are in the signing or construction phases.
Looking to its services, African customers may either buy generated solar energy via a PPA or lease a solar PV system on a monthly basis. The two alternatives are ideal for small companies that do not have the financial clout to invest in solar energy. Solarise is also working on helping to finance energy-saving firms looking to install more efficient air conditioners.
As a private entity, most of its clients are mid-sized companies drawn from the private sector, like schools, hospitals, malls and hotels. Valk estimated that most solar product options at his firm target companies willing to spend between $50,000 to $2 million.
Overall, Valk said Africa has an “overwhelming” need to invest in renewable energy, with progress over the past five years hindered by a lack of suitable financial solutions, primarily in the SME market.
He did emphasize that a number of solar energy companies are keen on making investments, but financial backing has remained an “enormous” challenge. Institutions such as banks are reluctant to fund solar energy companies, which have the will to invest in renewable energy, but lack the financial capability.
According to Valk, most financial institutions, including banks, are not doing enough to offer solar companies’ solutions in Africa. He suggested that such institutions should be a role model and support renewable energy financing by offering leasing options. With the rise of climate change use of renewable energy, like solar, should be incorporated by organizations.
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