The investment is likely the largest pure venture equity round for a solar home system provider in emerging markets.
Off Grid Electric closed its Series D funding Friday with $55 million from Helios Investment Partners and General Electric’s venture capital arm.
The round adds to a growing roster of home solar providers operating in developing countries that are pulling in large sums. In 2017, M-Kopa raised $80 million, Greenlight Planet raised $60 million and Developing World Markets financed 11 companies with a $60.8 million social impact note.
According to GTM Research solar analyst Benjamin Attia, Off Grid’s $55 million is likely the biggest pure venture equity investment for a home solar provider on record.
The announcement comes days after Husk set a record for the largest investment to date in a single minigrid company.
The growing size and number of investments in off-grid companies indicates the sector is maturing. A recent analysis from the International Energy Agency found that through 2030, off-grid energy systems are the cheapest option for 70 percent of rural users who will gain electricity access.
Off Grid Electric — known as Zola in its service areas — serves over 150,000 homes with its off-grid solar home systems. The latest investment round will fund an expansion into Ghana, where the startup will continue a partnership it recently started with French utility EDF in the Ivory Coast region. CH Group, a company based in Ghana with subsidiaries in energy, telecommunications and other industries, rounds out the deal with a 20 percent stake.
“The subsequent investment into expanding this partnership with EDF is an important signpost for more market activity beyond the grid from global energy majors,” said Attia. “As the off-grid energy access space matures and the pay-as-you-go solar business model is increasingly proven, energy giants and other strategic investors from the technology, infrastructure and information sectors are taking notice.”
EDF said off-grid power represents “a strong contributor” to the expansion of its business.
“For us, the sale of 10,000 off-grid kits in Côte d’Ivoire within the space of just a few months is living proof of the appeal and efficiency offered by off-grid solutions,” said Marianne Laigneau, senior executive vice president of EDF’s international division.
The new investment brings Off Grid’s offerings into four countries throughout Africa, including the Ivory Coast, Tanzania and Rwanda.
According to the company’s CEO, Xavier Helgesen, the improving economics of solar make growth possible. “The fundamental economics drive this all,” Helgesen told Bloomberg.