Tim McDonnell of Semafor reports on solar financing in Africa.
- Holm is a South African company that is using AI to streamline rooftop solar project applications and has recently launched a financing venture that will allow low-income families to lease to own solar panels.
- Groupe Filatex, the largest private power producer in Madagascar, is working with the World Bank to finance small solar farms on the island which is dependent on dirty and expensive imported heavy crude.
- Meanwhile Ignite is deploying small solar panels to remote villages in Rwanda and charging consumers $1 per month subscriptions to keep the panels.
“For African countries, the biggest obstacle to building out the solar industry is that the financing tricks used in China, Europe, and the U.S. to clear the way for widespread solar adoption — government subsidies and utility payments to solar-equipped customers — can’t work in places where states, utilities, and households are all chronically strapped for cash. At the same time, supply chain problems and the widespread perception by financial institutions that investments in Africa are high-risk mean that the cost of solar is far higher than in other places — the same solar system costs twice as much in Ghana as in the U.S. Bringing down the cost of capital requires a stronger track record of profitable investments than what the industry has been able to show so far. That means new business models are needed to make solar affordable for a broader base of customers.”
Read the full article here.
The views and opinions expressed are those of the author’s and do not necessarily reflect the official policy or position of C3.
