West African PAYG solar firm PEG Africa has followed up its recent USD 25 Mn Series C funding by raising a further USD 5 Mn in subordinated junior debt investment from EU-backed ElectriFi initiative to secure its market-leading position in West Africa.
PEG Africa is a leader in deploying and financing solar to households and SMEs in West Africa. Via its PAYG financing model, it enables customers to replace their perpetual spending on poor-quality polluting fuels such as kerosene and diesel with solar energy. PEG is currently serving 400,000 daily users in Ghana, Cote d’Ivoire, and Senegal, and has recently expanded into solar water irrigation and bigger solar power systems.
ElectriFI, the Electrification Financing Initiative, is funded by the European Union and managed by the EDFI Management Company, established by 15 European Development Finance Institutions.
The funding will be used for growth in PEG’s existing markets. The company was also among the recipients of funding of the newly unveiled USD 40 Mn Palladium fund. So far, the cleantech initiative has raised no less than USD 55 Mn.
“PEG has almost doubled in size every year since 2015,” said CEO Hugh Whalan, “and the fact we are now able to raise a significant amount of our funding in debt demonstrates that our approach is financially sustainable. We are delighted to work with ElectriFI to further accelerate our growth.”
Dominiek Deconinck, ElectriFI fund manager, said the ElectriFI initiative was thrilled to support PEG Africa on its growth path.
“With 82.000 direct new connections by the end of 2019, together with adding not less than 1.7 MW with Solar Home Systems, ElectriFI’s investment in PEG will strongly contribute to improving the quality of life through renewable energy in the markets it operates in,” he said.
“ElectriFI’s innovative financing is catalyzing the financing by UK DFI, CDC group, which, together with SunFunder, provided a US$15 million senior secured debt facility in local currency earlier in 2019.”
PEG has 450 full-time staff, over 600 commission-based sales agents, and has earned many prestigious awards including the International Ashden Award (UK) for Innovative Financing, Inclusive Fintech 50, and being named by the London Stock Exchange as one of the Fast Growing Companies in Africa.