ZOLA Electric, formerly known as Off Grid Electric, an African renewable energy company, has secured $32.5 million in funding from FMO, the Dutch entrepreneurial development bank; and Symbiotics, a leading investment firm specialized in emerging, sustainable and inclusive finance.
The $32.5 million finance facility will finance the growth of ZOLA’s Tanzania operations over the next five years. FMO is the lead arranger in the financing package that will grow ZOLA Electric’s service delivery in Tanzania, helping an additional 145,500 households to access energy in areas with no grid infrastructure.
The investment is also expected to create around 2,100 new jobs in off-grid solar sector. ZOLA currently powers more than 1,000,000 customers across five countries and employs more than 1,000 people.
“We are excited to announce this new investment from FMO and Symbiotics. It will allow us to connect more people in Tanzania, support the communities in which we operate and continue the development of our industry-leading power systems,” said Bill Lenihan, Co-CEO, ZOLA Electric in a press release.
Rosemarijn van der Meij, Fund manager of the Access to Energy Fund (AEF), managed by FMO, said, “The off-grid sector is developing fast and receiving increased attention from investors but is still perceived as high risk; few players have reached profitability. ZOLA Electric Tanzania has a dedicated and professional management team and is well on the way on its path towards profitability. This transaction fits FMO’s inclusive business and green strategy as well as the core theme in the strategy of the Access to Energy Fund: providing access to energy for the unreached rural communities.”
Vivek Pradhan, Head of Market Innovation, Symbiotics, said, “As an existing provider of debt financing to ZOLA since 2017, we are excited to grow our partnership with one of the earliest leaders of the effort to electrify Sub-Saharan Africa through affordable solar power. Symbiotics will continue to support the provision of accessible clean energy to under-electrified households, businesses, and communities in emerging markets.”
ZOLA has expansion plans for all major African nations. In 2019, ZOLA Electric aims to expand its PAYGo distributed solar energy model and launch an affordable renewable energy alternative available to Nigerians. ZOLA’s target is to deliver clean energy access to 1 million households and businesses in Nigeria over the next three years.
In July 2018, ZOLA Electric secured $20 million in debt financing from solar-business lender SunFunder to be utilized to aid its expansion across the African continent.
Image credit: Off Grid Electric
Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.