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candi solar Fuels Green Economy Growth in South Africa with US $25 Million Impact Investment Funding Earmarked for Solar

Solar solutions provider, candi solar, offers an innovative financial model offering to companies who can’t afford the often hefty startup capital cost of solar installations. This initiative addresses a pressing need in the South African market, where conventional financial instruments fail to effectively address more than 90% of companies, according to co-founder and finance director, Fabio Eucalipto. It’s a gap that candi solar is eager to bridge.

Solar & Battery Storage as a Load Shedding Solution?

2023 was a challenging year for South African businesses with load shedding levels reaching record highs. In fact, last year received more load shedding than the previous 10 years combined, making it clear that grid energy is simply no longer reliable. Many have been seeking alternative methods for keeping the lights on and solar installations are an obvious choice considering our abundance of sunlight. 

The upfront capital, especially for small, medium, and micro enterprises (SMMEs), and finding reliable engineering, procurement, and construction (EPC) providers remain challenges in the market. candi solar not only provides flexible solar financing, they carry solar risk for customers by overseeing the installation, and the system’s operations and management with their team of expert in-house engineers. 

Addressing the Financing Gap

“The business case for solar is clear but the capital is missing. This is a key gap in the market which candi solar seeks to address,” explains Eucalipto. Not a new player in the solar game, but a relatively new entrant in the South African market, candi solar offers customised solar and battery storage solutions. Originating in Switzerland, and backed by Swiss expertise and ingenuity, candi has already raised about US $80 million in funding, out of which US $25 million is earmarked for South Africa. They anticipate doubling this figure in the upcoming year, targeting the Global South (developing countries), notably India and South Africa. 

Why focus on these two countries? India is the third largest consumer of fossil fuels in the world (behind China and the United States). South Africa also features in the global top 20. “You also see a big difference in the size of the companies in the Global South compared to the Global North,” says Eucalipto. “In the Global South, most companies are SMMEs [more than 90% in South Africa], whereas in the Global North the economic power comes from large corporates. If you don’t address the challenges faced by SMMEs, you’re not addressing some of the key macroeconomic challenges in countries in the Global South.” 

What is Impact Investment and why is it important?

Conventional investment focuses on generating a financial return whereas ‘impact investment’ achieves financial returns alongside social and environmental impact, typically aligned with the UN Sustainable Development Goals (SDGs), explains Eucalipto. Examples include achieving reduced carbon emissions and additional employment opportunities for women, among many other positive impacts. 

In essence, impact investment extends beyond the investor to provide greater returns for more stakeholders. “If you want to create development for the entire economy, you need to shift your focus from a conventional, financial-return focused investment point of view to a more holistic, impact-driven investment point of view,” he adds.

When we invest in countries in the Global South, we help to stimulate productivity and profitability. The knock-on effects not only contribute towards an increased GDP, but also lead to a reduced dependency on fossil fuels, and a reduction in harmful environmental effects.

candi’s Global Solar Success

The candi solar stable consists of 156  installations, equating to over 88 MWp in size. A global retail customer in India is currently saving up to 75% on the cost of electricity compared to using energy from the national grid. In South Africa, where our national grid is unreliable, it is consistent energy supply and cost savings that make solar a compelling alternative energy option. Pretoria-based, Menlyn Retail Park’s 950 kWp system, which became operational in October 2023, provides just under 40% of the retail park’s energy needs. It’s expected to save a whopping R69 million over the 25-year lifespan of the system, while mitigating the carbon impact of 4,105 commercial flights around the world. 

A Passion for Helping SMMEs Thrive

The heart of candi’s mission is to serve not only big well-known businesses, but SMMEs across the Global South. In South Africa they’ve assisted several SMMEs in the agricultural sector, which from an impact investment perspective, sees a high return of positive impacts, according to Eucalipto. In India, candi has worked with several SMMEs in the manufacturing sector (namely, building materials and textiles). While these may be considered small businesses, many of them have huge power consumption. Solar power helps to reduce the carbon impact of these industries, while also providing clean energy at a lower cost than the national grid. 

For SMMEs, it’s all about leveraging candi’s own networks to support those who are rich in ideas but not in capital. It’s an important means for shifting capital from the Global North to the Global South and generating a more equitable and just society, while harnessing their expertise to stimulate green economy growth.