Ghana-headquartered pay-as-you-go (PAYG) solar company PEG Africa has raised US$25 million in Series C funding, taking its total secured investment to US$50 million.
PEG Africa uses a PAYG financing model to provide credit for solar home systems to underserved households in Ghana, Ivory Coast and Senegal, and serves over 60,000 households.
The company has now announced it raised a US$25 million Series C round from existing and new investors towards the end of last year, taking its total raised funding to date to US$50 million following a US$13.5 million round in 2017 and two other rounds in 2016. PEG will use this latest financing to further establish itself as a market leader in West Africa, the company said.
“As the first PAYG financing company to set up in West Africa, we have always felt that we could build a large, profitable business by being laser focused on financing the solar needs of underserved customers in this region,” said PEG chief executive officer (CEO) Hugh Whalan.
“Our solar solutions deliver better, cleaner and cheaper energy to our customers, and we have been successful at expanding rapidly and profitably while improving the lives of some of the poorest and most vulnerable in the countries we operate in.”
US$20 million of the round is in debt, with CDC Group, the UK’s development finance institution, arranging a US$15 million multi-currency facility. It is joined by existing lenders SunFunder and ResponsAbility, while the remaining US$5 million comes in the form of equity investments from existing investors, such as Energy Access Ventures and Blue Haven Initiative, and new investors Total Energy Ventures and the Renewable Energy Performance Platform (REPP).
“This facility is the first local currency debt provided by CDC to a solar company in the region and marks an important step towards reducing the sector’s exposure to currency fluctuations and increasing its long term financial sustainability,” said CDC managing director Holger Rothenbusch.