Off-Grid Electric, a Tanzania-based provider of off-grid solar power for small communities, has secured $7m in a round co-led by US-based solar system provider SolarCity, venture capital firm Vulcan Capital and investment firm Omidyar Network, VentureBeat has reported.
The company has not disclosed how much it has raised in total but other investors include Africa Enterprise Challenge Fund, BWE-JV Investments, Givia, Jasmine Social Investments, Marshall Foundation, Mulago Foundation, Segal Family Foundation, Serious Change and The World We Want Foundation, all of which either participated in the round or committed grant money.
Solar energy is fast becoming the default option for communities or businesses seeking to source power in areas located off the main grid. This has been fuelled by the dramatic fall in solar panel prices over the past three years, which has led to solar power becoming significantly cheaper than diesel in many developing nations.
“Solar power is already more cost effective than kerosene and other polluting power sources that are common in the developing world,” SolarCity CEO Lyndon Rive said in a statement. “Many emerging economies skipped the build-out of phone lines to go straight to cell phones, and the combination of solar and storage can obviate the need for more power lines. Off-Grid’s growth could have a profoundly positive impact on the economies, human health and air and water quality in the markets it serves.”
Although its share value has fallen almost 25% since it peaked in late February, SolarCity’s stock has risen 235% in the past year, and this has allowed it to be more active in its investments. The company acquired Paramount Solar and Zep Solar for a combined $278m in the second half of 2013 to boost its core offering, but its investment in Off-Grid indicates that it may also be willing to invest in order to enter overseas markets.