Norwegian investment company & clean energy developer Empower New Energy has signed an agreement to raise $74 million from a consortium of investors to develop solar energy projects in Africa’s commercial & industrial (C&I) sector. The deal was announced at the Africa Renewables Investment Summit (ARIS) that recently took place in Cape Town, South Africa.
The consortium is led by Climate Fund Managers (CFM), a joint venture between the Dutch development bank FMO and South African investment company Salnam Infraworks. The funding is also supported by the Norwegian development finance institution Norfund and the investment company Janeiro Energy AS.
The Norwegian Agency for Development Cooperation (NORAD) and Sustainable Energy Fund for Africa (SEFA), a multi-donor special fund managed by the African Development Bank (AfDB), are also been involved in setting up the Empower investment platform.
In addition to this capital, the consortium of investors will aim to raise debt that will enable Empower to invest up to $100 million in solar projects over the next three years. The investment is the largest single capital raise in Africa’s solar C&I sector.
Empower plans to install more than 150 MW of solar and battery storage capacity, generating more than 240 GWh of electricity and avoiding 200,000 tons of CO2 emissions. This milestone will see the company become one of the leading clean energy investment platforms serving the C&I sector in its target markets in Africa.
According to Terje Osmundsen, Founder & CEO of Empower, the new investment capital will enable the company and its project partners to solarize more than 50 African businesses, reducing electricity costs.
“In large parts of Africa, companies tend to pay 25-50% more for electricity than elsewhere in the world. As a result of our investment in on-site solar power production, often including batteries, our off-take partners can reduce electricity costs by 15-20% or more,” Osmundsen commented.
Empower New Energy and its investors have agreed to earmark 1% of the revenue generated by the solar projects for a community development program, focused on delivering high-impact projects in socially disadvantaged communities in targeted markets.
In 2019, Empower raised its first capital of $7.9 million and since then the company has carried out 8 solar investments for industrial and agricultural off-takers in Egypt, Ghana, and Nigeria. It has also signed contracts worth more than $30 million with other off-takers in several African nations.