On Thursday, Off Grid Electric announced that it had raised US$25 million in a series C round led by the venture capital firm DBL Partners. Previous investors in the company SolarCity, Microsoft co-Founder Paul Allen and eBay Founder Pierre Omidyar’s fund Omidyar Network joined DBL in the financing round. Off Grid Electric, which also advertises under its M-Power brand, offers solar energy as a service in Africa, starting with Tanzania and recently in Rwanda.
The company utilizes a leasing model openly inspired by investor SolarCity’s model. Lyndon Rive, SolarCity’s CEO, is a member of Off Grid Electric’s board. The company leases a solar panel (generally a 25-watt module) to a household not connected to grid, which is very common in Africa, and they link it to a 60 watt-hour battery, which can charge appliances such as cell phones, radios and lights. The system typically replaces kerosene lights which can be a health and safety hazard.
The households pay a monthly fee by cell phone, which is a common way to pay for services in Africa, to get access to the electricity generated through the systems. The fee is generally smaller than what they were used to pay for kerosene and the system, beyond being safer, is also more versatile since they can charge their electronics with it.
Off Grid Electric is currently adding about 10,000 customers per month and it will need to grow even faster to achieve its goal set with the Tanzanian government to power 1 million homes in the country with solar by 2017. The $25 million should go a long way to help them achieve it, but the money will also be put toward their recent expansion in Rwanda.