Solar solutions provider, candi solar, offers an innovative financial model to enable companies that cannot afford the often high capital cost of solar installations to gain the benefits of alternative clean energy, nonetheless.
One of the installations completed by candi solar in South Africa is at the Midrand head office of Schneider Electric.
It addresses a pressing need in the South African market where conventional financial instruments do not serve more than 90% of companies, according to co-founder and Finance Director, Fabio Eucalipto. It’s a gap that candi solar is keen to bridge.
Solar and battery energy storage
It has been a challenging year for South African businesses, with loadshedding levels reaching record highs. 2023 has seen more loadshedding than the previous 10 years combined. It is clear that grid energy is simply no longer reliable. Many have been seeking alternative means to keep the lights on and solar installations are an obvious choice, considering South Africa’s abundance of sunlight.
However, the upfront capital cost, especially for small, medium and micro enterprises (SMMEs), and finding reliable engineering, procurement, and construction (EPC) providers remain challenges in the market. candi solar provides flexible solar financing and carries the risk for customers by overseeing the installation, and the system’s operations and management, with its team of expert in-house engineers.
Addressing the financing gap
“The business case for solar is clear, but the capital is often missing. This is a key gap in the market which candi solar seeks to address,” says Eucalipto.
Not a new player in the solar sector, but a relatively new entrant in the South African market, candi solar offers customised solar and battery storage solutions. Originally established in Switzerland, and backed by Swiss expertise and ingenuity, candi has already raised about US$80 million in funding, of which US$25 million is earmarked for South Africa. The company expects to double this figure in the coming year, targeting developing countries in the Global South, in particular India and South Africa.
India is the third largest consumer of fossil fuels in the world (after China and the United States). South Africa is also listed in the global top 20.
Eucalipto points out too that there is a big difference in the average size of companies in the Global South compared to the Global North. “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 we don’t address the challenges faced by SMMEs, we’re not addressing some of the key macroeconomic challenges in countries in the Global South.”
Impact investment
Eucalipto also highlights some of the particular benefits of ‘impact investment’. “Conventional investment focuses on generating a financial return, whereas impact investment achieves financial returns alongside social and environmental impacts, typically aligned with the UN Sustainable Development Goals,” he says. These may include achieving reduced carbon emissions and additional employment opportunities for women, among many other positive impacts.
Impact investment extends beyond the investor to provide greater returns for more stakeholders. “If the aim is to support development for the entire economy, the focus needs to shift from a conventional, financial-return focused investment to a more holistic, impact-driven investment perspective,” he adds.
“When we invest in countries in the Global South, we help to stimulate productivity and profitability. The knock-on effects contribute towards an increased GDP, and lead to a reduced dependency on fossil fuels, and a reduction in harmful environmental effects.”
Global solar success
The candi solar stable includes 156 installations, providing more than 88 MWp in generation capacity. In one case, a 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 the national grid is unreliable, it is consistent energy supply and cost savings that make solar a compelling alternative energy option. In Pretoria, 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 is expected to save R69 million over the 25-year lifespan of the system and will mitigate the carbon impact of using the equivalent coal-fired power.
Helping SMMEs thrive
candi seeks to serve big businesses as well as SMMEs across the Global South. In South Africa it has assisted several SMMEs in the agricultural sector, which, in terms of impact investment, present a high return of positive impacts, Eucalipto notes. In India, candi has worked with several SMMEs in the manufacturing sector (building materials and textiles). Although these may be considered small businesses, many of them have high power consumption levels. Solar power helps to reduce the carbon impact of these industries and provide clean energy at a lower cost than is available via the national grid.
“For SMMEs, it’s about leveraging candi’s own networks to support those who are rich in ideas but not in capital,” Eucalipto says. “This is an important way of shifting capital from the Global North to the Global South and generating a more equitable and just society, and at the same time harnessing their respective expertise to stimulate green economy growth.”
For more information visit: www.candi.solar
