Solar power in Zambia is being harnessed by start ups
Solar power in Zambia is being harnessed by start ups and it’s working. We’ve spoken before about the issue that African nations have in capitalising on the bountiful amount of solar energy. Read a summary of my presentation at the World Energy Security Forum which relates to exactly that right here.
San Francisco startup, Fenix International, is making strides to expand the placement of solar power systems to areas across the globe, including in Africa. Energy and financial services firm, Fenix International is focused on making solar power systems available to individuals without access to electricity grids and is seeking to expand this process in Africa in partnership with a local wireless carrier with their flagship product called ReadyPay Power.
MTN Group Ltd. is one of the farthest reaching multinational mobile telecommunications groups in Africa. MTN operates in over 20 countries and has worked with Fenix since 2010 as an early investor.
Thanks to this extending partnership between Fenix International and MTN Group LTD., nearly 1 million new users in Zambia will come about over the next three years. Customers can expect to pay as little as $0.20 per day with MTN’s mobile money act until they have paid off their balance of the total amount due for the battery and solar panel system. These are about the size of a personal computer and offer the ability for individuals to light up their homes and charge mobile phones.
As a result of the pact between MTN and Fenix, Fenix is able to target customers who have little money and no access to banking to pay for the system up front. MTN is as a result, gaining new customers for their MTN Mobile Money program while it seeks to provide more than just data and call connections.
An alternative to kerosene lamps:
The system offered by Fenix International is a cheaper alternative to the typical kerosene lamps, wood fires and candles used by millions of people living in areas of fuel poverty across the continent. It is also a cleaner alternative. Nearly 80 percent of the population in Zambia (about 15 million people) have no access to the country’s power grid.
By 2020, Fenix aims to provide electricity to about 850,000 Zambians. This will make a huge difference in this area.
Fenix has also been working with MTN in areas like Uganda. The business in this area is expected to become profitable by the end of 2017, according to Fenix CEO Lyndsay Handler. Fenix hopes to expand into 10 countries in Africa over the next 4 years while becoming profitable during the same period.
Access to capital:
Equity Group Holdings Ltd. is a bank in Kenya that is expanding in the telecommunications industry as well. They have partnered with Fenix International to use a similar model as that used in Zambia, offering customers the ability to pay for their solar power with a mobile phone app.
The financing for this project in Zambia doesn’t stop there. Additionally, the Swedish Embassy in Zambia has committed almost $3m to the company’s efforts in Zambia between now and the year 2020. USAID is also contributing around $750,000 to the company.
We highlighted the opportunity and the issue 12 months ago. Now, it seems that exactly as we needed, the free market and private sector is intervening to capture value. Nice work.