Business-Focused Solar Firm Daystar Power Raises USD 4 Mn In SunFunder’s First Nigerian Backing

Lagos-based commercial solar firm Daystar Power has landed USD 4 Mn from SunFunder to provide cleantech solutions to businesses operating in Nigeria.

The industrial solar developer is now the first Nigerian company to attract financing from SunFunder – a Nairobi based specialist debt provider focused solar assets in emerging economies.

The funding comes almost a year after Daystar secured USD 10 Mn from Persistent Energy and Verod Capital Management. In the same March 2019 financial development, the company lined up USD 15 Mn in debt financing.

Most Nigerian businesses rely on traditional means of power, often generated from the consumption of diesel and fuel. These forms of power are not only costly, but also pose environmental/ health hazards.

With the new funding, Daystar looks to wean these businesses off the use of these power types, along which line pollution would be significantly reduced. Businesses targeted are in the commercial, industrial and agricultural sectors of Africa’s largest economy.

The energy company – which also has an office in Ghana – is on a mission to provide sustainable energy solutions which would reduce end-user energy costs by 20 percent and diesel consumption by 50 percent. Nigeria’s a country where 80 percent of businesses cite electrification challenges as the major drawback in breaking even.

The sound of generators is no louder than the electricity problems bedevilling the country. More than USD 14 Bn is spent on a yearly basis to backup diesel generators used to supplement the apparently unreliable grid electrification.

As a result of this deficit, Nigeria has the largest potential for C&I solar in Africa. Daystar Power, among others, sees business in the scale of the opportunity for diesel replacement.

SunFunder has backed prominent energy firms such as D.light, SolarNow (Uganda) Solar Works! (Mozambique), and PEG Africa (West Africa). ElectriFi is also taking a similar approach.

Interestingly, SunFunder and Daystar align on the front of gender parity, as both companies boast leadership teams comprising almost 50 percent women.

In October 2019, Daystar Power announced it had installed its 100th solar energy system in Nigeria since it was founded in 2017