SolarHome offers solar lighting system at a low-cost 24-month subscription plan, with an initial US$10 down payment
SolarHome, a Singapore-based company that brings pay-as-you-go solar solutions into off-grid households in Southeast Asia, announced today that it has raised US$2 million from local investment company TRIREC, which specialises in cleantech and renewable energy.
With this, the company’s total investments raised so far has touched US$4 million. Last October, SolarHome closed an oversubscribed pre-Series A round at US$625,000, led by Uberis Capital with participation from Beenext VC and other regional investors.
The fresh investment will support SolarHome’s plans to bring “reliable, affordable and clean energy to more than 40,000 homes in rural Myanmar by the end of 2018”. The firm also intends to increase distribution throughout Myanmar, advance its mobile money platform, as well as expand its product range to more premium products, including systems with bundled television sets.
SolarHome also plans to establish presence in Cambodia, Indonesia, and the Philippines by the end of this year.
SolarHome offers off-grid households a solar lighting system at a low-cost 24-month subscription plan, with an initial US$10 down payment, followed by daily, weekly, or monthly repayments through scratch cards or mobile money. Technology built into the system ensures that it won’t function if a payment is not made, giving lenders the confidence that they will be able to recover their investment.
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In just over a year since its 250-home pilot, SolarHome claim to have expanded distribution to over 14 hubs and installed over 11,000 homes with its off-grid systems. After completing the payment plan, the system is unlocked and transferred to the customer. This ‘rent-to-own’ model provides customers access to financing.
Currently, the firm employs over 200 field sales representatives and installers and is adding up to 35 workers per month to its sales force in Myanmar.
Melvyn Yeo, Co-founder and Partner at TRIREC, said: “SolarHome is a good fit for TRIREC and a natural addition to our renewables portfolio. There are close to 30 million households in Southeast Asia living off-grid, spending an estimated US$2 billion a year on legacy energy sources. SolarHome has secured a significant first-mover advantage in the space, demonstrating exponential growth while maintaining portfolio quality. There’s great synergy too between SolarHome and our existing portfolio and networks; we believe the partnership will help SolarHome secure access to competitive sources of debt capital and scale rapidly within and outside Myanmar.”
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A recent report by the World Bank Group’s Lighting Global Program and the Global Off-Grid Lighting Association (GOGLA) found that between 2012 and 2017, companies using the pay-as-you-go model accounted for about 85 per cent of growth in off-grid solar investments. The World Bank and GOGLA also predict that PAYG will continue fuelling the growth of solar home systems through 2022.
Photo by Andreas Gücklhorn on Unsplash
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