Arnergy’s $9 million funding is the latest in a growing number of investments in Nigeria’s electricity sector, and highlights investors’ confidence that the country’s unstable power system is ripe for solar projects that are independent of the national grid.
Announced Monday, the investment in Lagos-based Arnergy includes money from Breakthrough Energy Ventures, founded by Bill Gates, Jack Ma, Jeff Bezos, John Doerr, Vinod Khosla. The round also includes repeat Nigerian energy investors Belgium-based ElectriFi and Norway’s Norfund.
Five-year-old Arnergy installs mini-grid solar system for customers on demand and offers maintenance and software for users to monitor their energy consumption. The company currently serves 2,000 customers, including a hospital and a student dormitory in southern Nigeria. The company says it’s seeking new customers in healthcare, tourism, education among other areas.
Unreliable electricity supply costs Nigeria $29 billion dollars in economic losses every year, and investors are betting on renewable energy to fix the problem. Over the past two years, funding has poured into Nigeria’s solar sector: Starsight Power Utility scored $10 million from Norway’s Norfund in June, and PAS Solar secured a $10 million deal from ElectriFI in April.
- Nigeria’s electricity nightmare: with 80 million Nigerians having no access to the grid, the country’s private sector sees it as the second largest obstacle for business, after inadequate finance access. Nigeria’s electricity capacity, 13,000 MW for a population of 190 million, is less than 10% of that of Brazil, which has the same size of population.
- Solar to the rescue: A University College Cork study found that mini-grid solar system could address the country’s poor electricity delivery service caused by its crippling national grid.
- Karma Takeaway: Social impact investors from the U.S. and Europe are responding to Nigeria’s urgent need for alternative sources of electricity, pouring more funding into solar solutions.