SunFunder closes $2m debt facility in Mozambique with MFX Solutions for off-grid energy provider SolarWorks!
24-01-2019 08:25:00 | by: Nixon Kanali | hits: 2201 | Tags:

SunFunder, a solar finance company providing debt capital to solar enterprises in emerging markets has closed a $2m debt facility with SolarWorks!, a leading Pay-As-You-Go (PAYG) solar home system and energy services provider in Southern Africa.
The investment took an innovative multi-currency approach through a partnership with US-based currency hedging company MFX Solutions. It will be used primarily for working capital to accelerate SolarWorks!’ growth in Mozambique and marks the first transaction in that country for both SunFunder and MFX.
Avi Jacobson, Senior Investment Officer, who led the transaction for SunFunder, said  “Based on their performance, strong management, and impressive group of investors, we see that SolarWorks! is a company with the potential to scale up while improving the lives of tens of thousands of Mozambican families in the coming years. For SunFunder, this transaction aligns with our position as a preferred long-term finance partner for off-grid solar companies in Africa.”
“We are very proud to have closed this facility as we really appreciate SunFunder’s vision of aiming for long-term partnerships. The potential in our region is enormous so partners like SunFunder are of crucial importance in order to have large-scale impact on millions of people’s lives and at the same time deliver good financial returns for our finance partners.” Arnoud de Vroomen, CEO and co-founder of SolarWorks!, added.

They expect the financing to directly impact the lives of 65,000 people with improved energy access and in the process displace at least 26 tonnes of CO2 emissions.

“We are excited to be able to support this transaction which allows SolarWorks! to expand its vitally-needed solar services to households in Mozambique without taking on the burden of foreign currency debt. With few options for local financing, renewable energy companies in frontier markets need to rely on external capital which can be risky if the local currency depreciates. By integrating MFX’s hedging services into its lending model, SunFunder was able to offer the Mozambican metical (MZN) financing that SolarWorks! needs without increasing its own risk. Going forward, we think hedging can be an important part of meeting the financing needs of renewable energy companies in Southern Africa and beyond.”  Brian Cox, CEO of MFX Solutions, commented

Mozambique has an electrification rate of less than 30% and limited availability of debt capital to support off-grid solar solutions. SolarWorks! has been active in the country since 2011, and recently expanded into Malawi. The company provides a basic solar home system comprising lights and charging ports that can power phones, radios and small appliances, as well as more powerful systems that can support small businesses and middle-income households with reliable power.