Afrigeen Debt Impact Fund has invested €15m through a senior secured financing facility for SolarX, a solar solutions developer and operator for commercial and industrial customers in West Africa.
Afrigreen Debt Impact Fund, an infrastructure senior debt fund, has announced a €15m investment into SolarX, a solar solutions developer and operator for commercial and industrial (C&I) customers in West Africa.
SolarX is the seventh investment in the fund, which focuses on boosting access to solar power across sub-Saharan Africa and is co-managed by Rgreen Invest, a Paris-based asset manager and Echosys Invest, which provides long-term debt solutions for the installation of solar and small-size utility scale solar power plants in Africa.
The investment will enable the refinancing of the SolarX’s existing assets as well as support investment into new power plants in Côte d’Ivoire, Senegal, Mali and Burkina Faso.
Olivier Leruste, co-founder and managing partner at Echosys, told Impact Investor that since its establishment in 2020 by CEO Karim Ghammaché in Mali, with support from climate tech investors E3 Capital, the company has rapidly expanded to the three other countries and built more than 20 power plants.
“It is one of the few solar C&I players established across four West African countries with strong access to a deep network of SMEs. SolarX has proven very effective in securing and operating high-quality projects,” he said.
The company has also received equity investments from Dutch and French development finance institutions FMO and Proparco, and more recently, from Netherlands-based impact investor Triple Jump.
The fund, which reached final close of €100m earlier this year, will target a portfolio of between 15 and 20 projects or portfolios of projects once fully invested.
Senior secured financing facility
The investment is being made through a senior secured financing facility, which includes both a short-term tranche and a long-term tranche. Leruste explained that the short-term tranche will help SolarX accelerate its trading activity.
“Part of the C&I solar business is managed by local installers and/or directly contracted by industrial companies. SolarX is capturing part of this growing segment,” he said.
“The long-term tranche will finance the PV installations owned, built, and operated by SolarX, dedicated to powering commercial and industrial companies through a comprehensive, fully funded solar service,” he added.
Solar energy adoption in Africa
According to Leruste, the continuing electricity price increases across West Africa coupled with decreasing costs of PV modules and storage systems, are driving solar energy adoption across the region.
“Power generated from diesel gensets has become far more expensive, prompting commercial and industrial companies to turn to solar as a competitive and reliable solution. What they seek is a fully funded, turnkey offer, exactly what companies like SolarX, supported by financial instruments such as the Afrigreen Debt Impact Fund, provide,” he said.
Leruste said the most dynamic markets for solar power in Africa are Nigeria, Mali, Burkina Faso, Côte d’Ivoire, and Senegal.
“Kenya and Ghana are also active, with Zambia and Tanzania developing at a slower pace. South Africa remains the largest C&I market, with its own specific dynamics and funding ecosystem,” he said, adding that for now, however, SolarX remains focused on West Africa, where the market potential is both deep and largely untapped.
Leruste said SolarX’s project pipeline is growing rapidly, particularly in Côte d’Ivoire, where recent electricity tariff increases have made solar energy even more competitive.
“The country also benefits from a large and diversified industrial base, offering significant opportunities for C&I solar deployment,” he said.
