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Africa-focused Investor Sunfunder Defies Covid-19 To Close $140m In Funding For Off-grid Energy Companies

February 28, 2021

Even though the coronavirus ravaged the world for a greater part of last year, SunFunder, the Kenya-based venture capital company offering debt financing to solar companies in emerging and frontier markets, and previous investor in Nigerian solar energy company — Zola Electric, has announced it increased its funding to or emerging market solar to $140 million. The company said part of the funding came from the over-subscribed $70m SET Fund, which saw commitments from new investors including Swedfund and OeEB.

“With the closing of the oversubscribed SET Fund, we are now looking ahead to accelerating our investments and impact over the coming years. This will take new partnerships, new fund structures and new capital committed to the climate finance and clean energy transition,” the company said.

Just recently, the company syndicated an $11m debt facility for Nairobi-headquartered off-grid solar technology company servicing smallholder farmers, SunCulture. The co-investors were Triodos Investment Management, Nordic Development Fund, AlphaMundi and an AfDB fund managed by Lion’s Head.

The firm which currently has 56 portfolio companies across 23 countries, said 8 more potential investments are currently in advanced due diligence stage.

A Look At What SunFunder Does And How Off-grid Companies May Apply For Loans From It

SunFunder provides innovative debt financing for solar enterprises working in emerging and frontier markets. It collaborates with major debt fund investors around the world to unlock capital for solar energy projects. Find out more below.

It invests in solar enterprises across Africa and other regions that need debt financing to scale. The company helps companies that are active in the off-grid, residential, productive use, mini-grid and commercial and industrial solar sectors. These companies range from established global players to early-stage pioneers.

To know more about SunFunder’s loan application process, click here.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

Solar Energy Startups In Kenya Have New Licensing Rules To Worry About

December 13, 2020

A stakeholders’ meeting had come to an end on Friday December 11, 2020 at Kenya’s Energy and Petroleum Regulatory Authority (EPRA)’s office in Nairobi, and all parties have known each other’s positions. But the bottom line now is that a new set of rules, Energy (Solar Photovoltaic Systems) Regulations, 2020, would be enacted after all. In a sweeping move, the Energy and Petroleum Regulatory Authority (EPRA) intends, through the proposed regulation, to regulate the solar energy sector in Kenya, a move seen to try and protect Kenya Power from competition, as revenues continue to fall despite the company enjoying monopoly. Many stakeholders have also described the move as an attempt by EPRA “to police the sun”.

*Epra Principal Renewable Energy Officer Caroline Kimathi,*

“We are not here to protect Kenya Power. We are licensing people who are going to install the solar panel. If the stakeholders call for a reduction of the fees to be paid then we are going to adopt that, but in no way is this going to shield Kenya Power,” said Epra Principal Renewable Energy Officer Caroline Kimathi, at the meeting.

What Do The Proposed New Rules State?

The rules are launching a strict licensing regime for the solar energy sector in Kenya. For instance, the rules state that a person shall not engage in the importation, manufacture, sale or installation of solar PV systems or solar PV system components without a valid license issued by EPRA.

The rules further go ahead to empower the Authority to from, from time to time, determine by publication of a notice, the types of solar PV components and solar PV systems to which the regulation applies. But as a general rule, all the products must also conform to the Kenya Standard.

“A manufacturer or importer of solar PV systems, components, and consumer devices shall ensure that the products conform to the relevant Kenya Standard set out in the Seventh Schedule or any other subsequent or applicable Kenyan Standards,” the regulations read in part.

Apart from the above, solar energy companies in the country must also first register all consumer devices with the authority. The implication of this is that manufacturers or importers of solar PV consumer devices shall have their products registered by the authority on meeting the requirements of relevant Kenya Standard or other equivalent international programmes for such products. EPRA will also determine which products are allowed into the Kenyan market, by the rules.

Solar Energy rules Kenya Solar Energy rules Kenya

High Licensing Fees And Increase In Cost Of Doing Business For Solar Energy Companies

If the rules sail through at the end of the day in parliament, it may spell doom for existing and yet-to-exist solar energy companies as the cost of doing business will most certainly increase.
For instance, under the rules, a solar technician is required to pay between Sh2,250 and Sh6,000 ($20 to $54k) to obtain and renew a license.
Similarly, a contractor will pay between Sh3,000 ($27k) and Sh6,000 ($53k) for a licence, which will be valid for three years, with practitioners required to apply for renewal one month before the expiry.
Both technicians and contractors will also be required to obtain insurance policies for their licences of between Sh1 million and Sh10 million ($9000 to $90,000), based on their respective licence categories.
A fine of Sh50,000 ($450), per day, will be imposed on anyone practicing with an expired licence.
The stringent proposed regulation also includes a Sh10,000 ($90) fine if individuals delay renewing their license and Sh20,000 ($180) if they do not issue a completion certificate for a project or warranty for installation.
Additionally, penalties on failure to provide data to EPRA or providing false data will range between Sh5,000 and Sh1 million.
Licenses are based on the capacity of the system to be installed. License classes SPW1, SPW2 and SPW3 are for solar systems with a capacity of not more than 400 watts, 2kW and 50kW respectively. Only SPW4 technicians will be allowed to install solar grids of any capacity.
Investors have poured nearly $1 billion into the development of off-grid solar energy and retail technology companies in Africa such as M-kopa, Greenlight Planet, d.light design, ZOLA Electric and SolarHome. Most of these companies are located in Kenya.

To know more about the proposed rules, click here (PDF).

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

Efficiency for Access allocates $3.7m to solar related technologies in Africa

October 24, 2020

The Efficiency for Access Research and Development Fund has just allocated more than 3.75 million dollars to 20 start-ups, three of which are based in Africa. The funds are earmarked for the development of solar-powered technologies. This funding follows a call for projects which saw the participation of several African start-ups, notably Jirogasy, based in Madagascar and specialising in connected objects and solar kits.

To promote the development of solar energy technologies. This is one of the objectives of a call for projects from the Efficiency for Access Research and Development Fund, the results of which are now known. The investment fund has decided to allocate £2.9 million (over $3.75 million) to finance the projects selected. These solutions will be developed by at least 20 start-ups, including three based in Africa.

Among the projects developed on the African continent and selected by Efficiency for Access is “Jirodesk V2”, a solar computer project led by the Malagasy start-up Jirogasy. “It aims to develop a solar-powered, all-in-one, energy-efficient computer that can be assembled locally. Once the pilot project is completed, the company aims to provide solar-powered computers to more than 10,000 Malagasy students each year,” explains Efficiency for Access.

According to Jirogasy, the choice of its solution for access to education via solar energy has enabled it to develop a new generation of its “more efficient” solar computers. According to him, the new computer will enable accelerated digitisation of education in Madagascar, especially in areas that are not connected to the national grid or have a low electricity supply.

“As a continuation of Jirogasy’s efforts, this PC will be designed and assembled locally with the manufacturing talent that already exists in Madagascar. It is a team of 12 technicians and engineers. In this assembly, Jirogasy favours the use of recycled components of African origin. The start-up is thus part of a circular economy approach to strengthen the local and continental economy throughout its value chain,” explains the young company based in Tananarive. This solution could also be deployed in other African countries where the digitisation of education is lacking due in particular to the low rate of access to electricity.

Simusolar’s solution also caught the attention of Efficiency for Access. The start-up is developing a project called “PAYG Bridge” to facilitate data synchronisation and the distribution of solar-powered pumps. These pumps enable smallholder farmers in Tanzania to irrigate their plantations. Simusolar’s pumps and other solar-powered devices are accessible to low-income populations through pay-as-you-go systems.

Within the framework of Modern Energy Cooking Services, six other start-ups have received funding from Efficiency for Access. These projects will be implemented in sub-Saharan Africa. The initiative is supported by the British cooperation and the IKEA Foundation of the late Swedish billionaire Ingvar Kamprad.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

SunFunder Invests Over $100m In Venture Debts In Two African Solar Startups

May 18, 2020

As the coronavirus pandemic continues to ravage the world, SunFunder the Kenya-based venture capital company offering debt financing to solar companies in emerging and frontier markets has announced it has invested over $100 million in venture debt in four solar businesses, including its portfolio startups, M-KOPA in Kenya and PEG Africa in Ghana.

‘‘The Covid-19 pandemic has changed all our lives. The companies we work with have all been impacted to an extent, as well as their customers, who have most to gain or lose from how this crisis plays out for the energy access sector. SunFunder acted fast to get ahead of these impacts and help mitigate the risks to our sector as best as possible. We have been working closely with our existing borrowers to understand how they and their customers are being impacted, and in turn how SunFunder can continue to support them and best manage any new risks to our portfolio and investors,’’ SunFunder said in a statement.

Here Is What You Need To Know

According to SunFunder, it closed four new loans at the end of Q1, 2020 bringing the total loan sum to $100m which it invested in distributed solar in Africa and other emerging regions.
The company said the new loans were with two existing solar home system borrowers — M-KOPA in Kenya and PEG Africa in Ghana — as well as long-term financing for the solarisation of Orange’s telecom towers in the Central African Republic by energy solutions provider CREI, which would cut CO2 emissions by 1,300 tons annually.
It also disclosed that it sealed its first commercial & industrial (C&I) end user financing with MCI in Kenya for a solar installation and energy efficiency improvements.

“We are still open for business and looking to support the sector further. We are doing this by working closely with all our partners, our portfolio companies and potential new investees,” the company further said.

SunFunder has been active in the African solar business ecosystem investing in solar startups such as Zola Electric in Nigeria, PEG Africa in Ghana, Solarnow in Uganda, Astonfield in Kenya, Inspira farms in Rwanda, among others.
The company also announced new partnerships with organisations like Sida and DFC, who, it said, has provided it with credit guarantee and political risk insurance facilities respectively, as it looks to mitigate new risks posed by the coronavirus pandemic.

“Emerging from the Covid-19 crisis will be a long process,” the company said. “We are doing all we can to make sure it doesn’t set back the longer-term challenges of solving energy access and climate change.”

New Initiatives For Solar Startups In Africa

Aware of the continuing threat posed by the pandemic to solar businesses in Africa, SunFunder also said it is working with Acumen, Persistent and responsAbility, among others, on setting up a relief fund for energy access companies, to support them through the crisis and protect local jobs.

“We will be providing more information about this soon, but any companies (or investors) that have not yet registered their interest can do so here: energyaccessrelief.org,” it said.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer.

Ghana’s PEG Africa Secures $4m In Debt Capital To Scale Operations In Senegal

October 19, 2019

PEG Africa, an Accra-based pay-as-you-go solar energy company has sealed a $4-million debt financing deal from a $15-million multi-currency facility led by UK development finance institution CDC Group. Also, backed by existing lenders SunFunder and ResponsAbility, PEG Africa explained in a statement that it will use the capital to expand operations in Senegal where it says it has thousands of customers.

PEG Africa was founded in 2013 by Hugh Whalan and Nate Heller

Expanding to Senegal

Whalan, the PEG Africa’s CEO, said Senegal has been growing “far quicker than expected” and has reached profitably within its first year.

“With the continued backing of CDC Group, we expect our growth in Senegal to continue. Importantly, we believe that we will be able to apply our learnings and expansion playbook to yield superior results as we grow into future markets,” he added.

Why Debt Financing?

Whalan said the fact the company is increasingly raising debt as opposed to equity investment, and its ability to secure multiple facilities from lenders like CDC Group, is testament to the increasing strength and the financial sustainability of its business.

Last month PEG Africa raised $5-million in debt funding from the EU-funded Electrification Financing Initiative (ElectriFI).

In March the company raised a $25-million Series-C round which at the time it said it intended to use for off-grid solar expansion in Ivory Coast, Ghana and Senegal.

About PEG Africa

PEG touts itself as employing nearly 1000 people across Ghana, Ivory Coast and Senegal and has won numerous awards, including the prestigious Ashden International Award for excellence in sustainable energy, and has been named as one of the “fastest growing companies in Africa” by the London Stock Exchange.

Founded in 2013 by Hugh Whalan and Nate Heller, PEG Africa currently provides 400 000 daily users in Ivory Coast, Ghana and Senegal with credit for solar home systems via its pay-as-you-go financing model.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world

Nigerian Solar Energy Startup Anergy Raises USD 9 Mn To Scale Operations

June 25, 2019

Startups in Nigeria do not seem to be leaving any stones unturned. Nigerian based solar energy distribution startup, Anergy has raised 9 million (NGN3.2 billion) in Series A to fund its commercial growth with new business models, improve on partnership avenues, and expand its activities.

The Funding At A Glance

The funding round was led by Breakthrough Energy Ventures, while Shell-funded All On Energy, the European Union-backed ElectriFI and the Norwegian Investment Fund for Developing Countries (Norfund) participated in the capital injection.
Founded in 2014 by Femi Adeyemo and Kunle Odebunmi, Anergy provides solar power systems to homes and businesses, with a special focus on companies spanning the hospitality, education, financial, agriculture, and healthcare industries.
In the last half-a-decade, the startup claims to have installed over 2 MW of clean energy solutions for more than 2,000 clients.

Funding Was To Scale Operations

“We believe that energy needs in Nigeria have surpassed rudimentary requirements of low power utilization and our product offerings are solving for reliability and not just access,” says CEO Femi Adeyemo, Anergy

“ElectriFI, an EU-funded access to energy impact facility, is thrilled to join such a strong group of investors backing visionary entrepreneurs who will positively impact thousands of local businesses in Nigeria,” said Dominiek Deconinck, ElectriFI Fund Manager.

What Anergy Does

Anergy’s distributed energy systems leverage the amalgamation of solar power, superior storage solutions, and proprietary remote management technologies. The startup uses this to deliver scalable, reliable, and affordable solutions designed to address the problems associated with intermittency and grid unreliability.

“Arnergy inherently understands the West African market and its need for power reliability. Creating accessibility to reliable renewable energy sources is paramount to economic growth in this region.With Arnergy’s technology, we can significantly decrease carbon emissions, and it’s a model that can be replicated all over the developing world,” said Carmichael Roberts of Breakthrough Energy Ventures.

What Attracted Investors To The Startup

The startup got the investment because, according to Mark Davis, EVP Clean Energy from Norfund,

“Access to clean and stable energy is a prerequisite for job creation and development.’’

Davis said Norfund is proud to support the expansion of Arnergy which will provide Nigerian households and businesses on a weak-grid connection with a cheaper, cleaner and more reliable power solution to meet their daily needs.

‘‘ElectriFI, an EU-funded access to energy impact facility, is thrilled to join such a strong group of investors backing visionary entrepreneurs who will positively impact thousands of local businesses in Nigeria,” said Dominiek Deconinck, ElectriFI Fund Manager.

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world.

Afrikan Heroes

Tag: solar energy

Africa-focused Investor Sunfunder Defies Covid-19 To Close $140m In Funding For Off-grid Energy Companies

A Look At What SunFunder Does And How Off-grid Companies May Apply For Loans From It

Charles Rapulu Udoh

Solar Energy Startups In Kenya Have New Licensing Rules To Worry About

What Do The Proposed New Rules State?

High Licensing Fees And Increase In Cost Of Doing Business For Solar Energy Companies

Charles Rapulu Udoh

Efficiency for Access allocates $3.7m to solar related technologies in Africa

Kelechi Deca

SunFunder Invests Over $100m In Venture Debts In Two African Solar Startups

Here Is What You Need To Know

New Initiatives For Solar Startups In Africa

Charles Rapulu Udoh

Ghana’s PEG Africa Secures $4m In Debt Capital To Scale Operations In Senegal

Expanding to Senegal

Why Debt Financing?

About PEG Africa

Charles Rapulu Udoh

Nigerian Solar Energy Startup Anergy Raises USD 9 Mn To Scale Operations

The Funding At A Glance

Funding Was To Scale Operations

What Anergy Does

What Attracted Investors To The Startup

Charles Rapulu Udoh

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