USAID Announces 6.3 Million Dollars in Awards to Bolster Sub-Saharan Africa’s Off Grid Energy Sector

USAID has floated fund to provide capital to companies engaged in household solar-systems and micro-grids to expand operations.

The United States Agency for International Development (USAID) awards 6.3 million dollars to facilitate in advancing off-grid energy solutions in sub-Saharan Africa. USAID has also announced several new awards at the Unlocking Solar Capital:  Africa Conference in Abidjan, Côte d’Ivoire.

The awards provide capital to companies engaged in household solar-systems and micro-grids to expand operations, scale innovations, test new business models, and finance new rural-electrification connections to millions of people.  The USAID Scaling Off-Grid Energy (SOGE) Grand Challenge for Development and Power Africa issue the awards for household solar systems.

The awards will reach an estimated 4.5 million beneficiaries and leverage up to $200 million in private capital.  The micro-grid awards are funded by USAID’s Development Innovation Ventures program and Power Africa.

SOGE Awardees Include the Following:

• Solar Frontier Capital will launch a new $100 million debt facility to provide working-capital financing to pay-as-you-go (PAYG) off-grid solar companies across sub-Saharan Africa. The SOGE Award will assist with the facility’s structure, financing, and pipeline development.
• SIMA Funds will also launch a new $75 million debt facility for distributors of off-grid solar home systems that serve the off-grid energy sector.  The SOGE Award will create a second-loss tranche in the Fund to allow SIMA to expand its investment criteria to higher-risk, earlier-stage companies.
• Persistent Energy Capital will work with SOGE to scale its existing portfolio of PAYG solar companies across sub-Saharan Africa. Persistent Energy Capitalinvests in start-up and early-stage companies in the off-grid energy sector by providing risk capital that allows companies to scale and attract conventional growth equity and debt providers.
• Mobisol will launch SolarHub, a software platform to streamline operations, payments, and logistics for new and existing PAYG companies that distribute solar home systems.  The SOGE Award will support the development of this platform for early-stage companies.
• Baobab+ will expand its PAYG, product line of solar home systems, as a stand-alone entity from parent company Microcred.  The SOGE Awards will help test and expand the company’s current distribution model in Sénégal, Mali, Madagascar, and Côte d’Ivoire.
• Sunna Design will launch Moon, a Sénégal-based PAYG energy, digital, and financial-services venture.  SOGE will assist Sunna with the commercial launch of the Moon package, composed of a solar home system and smartphone with customer service apps and other digital offerings.

The Micro-Grid Awardees include:

• PowerGen will advance its small-power distributor model that aims to provide energy access to high-density population areas concentrated under the grid or in very close proximity to the grid through alternate current micro-grids.  PowerGen is currently building the last-mile distribution network from the main grid with a micro-grid.
• Devergy will pioneer the concept of affordable, rapidly deployable, “living” micro-grids.  Its system will allow customers to gain access to a variety of service levels, ranging from household lighting to major appliances.
• Powerhive will expand connections in Kenya by providing an initial 20 villages with 4,000 new household connections and 200 business connections with uninterrupted, 24/7, mini-grid-supplied renewable alternate current electricity.  It will also develop a Productive-Use Program in Western Kenya to provide customers with low-cost appliance leases and business loans, combined with enterprise-development support.

The Scaling Off-Grid Energy Grand Challenge for Development is a global partnership of USAID, Power Africa, Shell Foundation, the Department for International Development of the United Kingdom, and the African Development Bank that aims to extend energy access to 20 million households across sub-Saharan Africa by 2030.  SOGE mobilizes public and private investment in distributors of solar home systems, service- providers, and financial intermediaries across sub-Saharan Africa to help scale high-impact innovations, test new business models, attract private capital, and grow the off-grid energy market.

Source: USAID