Early this month, the International Finance Corporation (IFC) announced a USD $4.5 million loan for Off Grid Electric to expand its solar leasing program to households in Tanzania.
For a $6-10 up-front installation fee, the company provides a small solar power system including solar panels, lithium batteries, lights, and a meter. Customers then make small payments via mobile and receive an SMS passcode to unlock the system and gain access to the electricity produced.
“IFC’s backing and expertise will help us bring affordable power to millions of people across Africa,” said Xavier Helgesen, Off Grid Electric’s CEO, “We look forward to continuing this important work IFC’s support.”
Mr. Helgesen’s previous efforts in business have seen him recognized as Best Social Entrepreneur by Businessweek in 2009, and winner of the Fast Company Social Capitalist award.
Off Grid says its target market generally use polluting and dangerous kerosene lamps to light their homes – and their product delivers 50 times more light for less money. The typical customer pays between $5 and $10 a month for the solar electricity.
So far, the company has distributed close to 35,000 solar home systems in the Arusha, Kilimanjaro and Mwanza regions and its expansion plan has a goal of reaching 200,000 households in Tanzania by the end of this year. Even with that milestone reached, there are still plenty of opportunities to expand as around 8 million homes in Tanzania don’t have access to electricity.
“As developing countries move to a greener, low-carbon growth paths, the private sector will play a critical role in expanding access to energy,” said Oumar Seydi, IFC Director for Eastern and Southern Africa. “IFC supports as the innovation of Off Grid Electric, which provides low-cost, clean energy solutions to the millions of people in Africa not connected to the grid.”
The funding is being provided via the IFC Cleantech Innovation Facility. Over the past eight years, the IFC has invested $11 billion in renewable energy and other “climate-smart” solutions in developing countries.
In addition to providing clean, cheap power, Off Grid Electric says it has created thousands of jobs in the countries where it operates and supports tens of thousands of small businesses and local entrepreneurs with income from assisting their communities in going solar.
