South African-based solar crowd funder Sun Exchange has secured a $2.5 million convertible note financing from Africa Renewable power fund (ARPF), a Mauritian private equity fund advised by London-based ARCH Emerging Markets Partners Limited. This follows the company's close of $4 million series A funding round in 2020, led by a $3 million investment from ARCH. In an interview with pv magazine, Sun Exchange CEO Abraham Cambridge explains the company's expansion plans.
Congratulations on securing the $2.5 million convertible note financing from ARPF. What's the general feeling about this?
It's hugely exciting. We have grown hugely and done the biggest crowd-sourced project in African history in Zimbabwe. We closed our Series A investment last June. Since then, we have doubled our user base, and our existing investors have seen the promise and potential in our model, and they have doubled down on their investment through this convertible note to enable us to keep growing.
The timing is perfect for the product we are bringing to the market. More and more people are switching to solar, and we are the company to enable that. In the past couple of years, we have deployed and managed to fund $5.5 million worth of solar projects for the EPCs and project developers we work with, and that's through COVID. What we can bring in over the next couple of years is hugely exciting.
How will you manage and use the funds?
It's going to be used to enable our expansion into the rest of Africa. We will double down on our business development efforts in Namibia, Botswana, and potentially East and West Africa. We welcome with open arms any EPC or project developers that would like to work with Sun Exchange to get their project funded and built.
How do you plan to scale?
We want to deploy 1 GW over the next five years. Currently, we are at around 7 MW. We are on the trajectory of doing that. Our goal is 1 GW in five years across 10 countries.
Which new countries are you targeting to venture in?
We have our largest project in Zimbabwe for [the agricultural company] Nhimbe Fresh, a fantastic project. We are actively exploring projects in other African countries, but we are still appraising which countries to go into.
What's the current status of the Nhimbe Fresh project?
The solar installation is complete; we are waiting for the battery to be installed. The system will be live and operating in October.
What have you learned from the first phase of the Nhimbe Fresh project?
It's been an interesting experience working in Zimbabwe. We are building a high voltage mini-grid. We have learned how understanding the Zimbabwe Energy Regulatory Authority (ZERA) and Zimbabwe Electricity Supply Authority (ZESA) are very helpful in getting the project live and getting the generation license applied for the next phase.
What's been interesting is how open and welcoming the national utility is to enable the rollout of embedded solar. That is an indication that the rest of Africa is welcoming solar with open arms.
Do you have other projects, ongoing or new?
We have a project live now — a plastic recycling facility is open on our platform now. We have a school project launching after that, and then we have the second phase of Nhimbe Fresh coming soon.
What do you think about the African Energy Market?
This is the biggest opportunity in the economic history of Africa. The amount of money worldwide committed to investing in clean technology and to fight climate change is in the trillions of dollars. The only way African nations can develop sustainably is by going solar, and there are trillions of dollars in the world looking to invest in projects to enable that. Sun Exchange is in the front line to enable those funds across the globe to invest in solar projects in Africa.
The timing is perfect. The technology is now very well developed. The cost is completely economically viable in every market. So, we can very quickly deploy reliable, clean, and affordable solar electricity anywhere on the continent.
What's next for Sun Exchange?
Our goal is to deploy 1 GW in the next five years and further expand our user base. We have members in 180 countries, and we are currently appraising countries to start projects.
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