May 2017 – In this piece from Acumen: Ideas on Medium, one of our main investors discusses the importance of capital and financial support at the early stages of development in the off-grid energy sector. This truly inspiring read highlights our case, but also talks about the long-term goal that we all share: universal energy access.
Most of the existing funding goes toward bigger projects connected to the grid, but this solution is unrealistic. The average cost for a household to connect to the grid in Africa alone is $2,000, roughly 10 times the cost of your standard solar home system. Off-grid energy solutions have the potential to reach segments of the population who would otherwise be relying on dirty fuels or waiting for the centralized grid for decades to come. Yet very little funding is committed to off-grid renewables. For example, just 11 percent of the World Bank’s total energy access funding between 2011 and 2014 was allocated for off-grid energy solutions. The need for investors to step in and support companies providing off-grid energy solutions has never been clearer.
The companies we’re looking to invest in will provide energy to people faster, cleaner and at a price they can afford. They will also will help us better understand the poor’s energy needs and consumption, so we can build more effective products and services to serve them. These kinds of companies require patient investors willing to give them the time to get business models right before scaling and, when necessary, accept lower financial returns for outsized impact.
Read more and follow Acumen: Ideas on Medium.