With grids around the continent constantly being strained by heavy demand, small scale renewable investors are increasingly penetrating the off-grid energy space to decrease pressure on the national grid.
Decentralised electric power supply remains an important part of an intelligent mix of energy supply in many Sub-Saharan African countries resulting in a growth in Africa’s renewable energy space.
“One curve is going up and that is the demand for energy in rural areas and the other one is going down, that is the price of the components which can deliver that energy and that is solar,” said Andreas Spiess, Founder of Solarkiosk.
Spiess says solar is a “convincing” option because it is “sizeable, from extremely small to extremely large – we have seen gigantic power plants in Northern Africa, just as big as a big coal factory but you have also seen very small solar lights, and that is something only solar can bring to the table.”
“That inflection point now allows us as strategic investors to invest into a community which has maybe 25 000 people only and find a sizeable solution which is tailored for their needs and then with something, which we refer to as the energy ladder, climb up together with their respective ascending needs for energy and that is a very convincing model.
“Coca-Cola as we all know is not an energy company but Coca-Cola is very much keen to support a community to thrive and that is where we have shared value, because for us it is community development and for Coca-Cola it is the same thing.”
Spiess says the partnership with Coca-Cola is something he has not seen before – bringing together companies from different sectors, energy, beverages and connectivity to create the Ekocenter for the community in Rwanda.
As far as investment into rural communities goes Spiess recommends you invest in projects that have the potential to break-even within two to three years maximum.
“It is very conducive for scale investors if they team up in a bigger picture and that is for example where fascinating possibilities come into the space, like crowd funding.”
Spiess believes a small scale investor should find a financial solution which fits their size.
“There is a very big need for grid connected energy and I 100 per cent support it because that needs to go into productive use into the factories so that the manufacturing sector in Africa can thrive.”
As small investors in the off-grid space, they take pressure off the grid by finding solutions for the consumers and smaller businesses so that they do not add stress to the grid, allowing it to be used for larger players.
With regard to territories there is a difference between the use of the grid in the cities and the off-grid sector which is predominantly rural – however Spiess says this is changing as more and more businesses and customers are looking for back-up solutions.
Instead of making the grids exclusive Spiess reckons government is now on board with the realisation that the off-grid energy sector is supporting the on-grid energy sector.
“As we know, the grid is not always reliable, unfortunately not yet but it is to come, but for the time being, the solar back-up solutions are just invincible.”
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