Cleantech startup, Arnergy has raised $3 million in funding targeted at expanding its clean energy services in Nigeria.
The funding round was financed by All On, a Shell-backed off-grid energy impact investment company. This comes five years after Arnergy, a provider of solar power systems to homes and businesses, secured a $9 million Series A round in 2019.
All On, along with other firms, including Bill Gates’ Breakthrough Energy Ventures, ElectriFI, and Norfund, invested in Series A.
Founded in 2013 by Femi Adeyemo and Kunle Odebunmi, Arnergy was launched as a provider of sustainable energy services intended to deliver clean and reliable energy for businesses or homes. The company’s energy systems are tailored to tackle intermittent and grid unreliability issues, enabling residential customers and businesses across hospitality, education, finance, agriculture, and healthcare to access and install affordable and reliable distributed energy systems.
The funding
For Anergy’s CEO Adeyemo, the company’s fundraising was not merely about acquiring funds. The company rather looks out for specific triggers like the removal of fuel subsidies, approaching grid parity in terms of grid prices, and fluctuations in diesel prices.
Having last raised funds in 2019, Adeyemo highlighted Arnergy’s commitment to capital efficiency. He also pointed out the rising demand for solar systems since 2019, a period when many Nigerians didn’t view them as economically viable.
- “We are now bullish on leases given that cost competitiveness now makes sense. We’ve tested and tried it, and the chance of default is now lower because of the monthly expense of petrol or diesel. You can more or less switch that for solar. It wasn’t the case four years ago where you will be paying higher even if you’re on a five-year lease to own solar,” he said in an interview.
According to him, Arnergy plans to maintain its service provision across all 36 states where it operates in Nigeria through min-grid developers. Additionally, Arnergy is preparing to raise its Series B round, which is scheduled to close this quarter. The upcoming funding round aims to facilitate further expansion of its operations and accelerate the adoption of its renewable energy products and solutions within and outside Nigeria.
Investors’ confidence
Commenting on the latest raise, All On CEO, Caroline Eboumbou, in a statement said:
- “We are proud of our partnership with Arnergy over the past years. With this partnership, we have been able to achieve some of our goals to empower communities and create a cleaner future for Nigeria. Arnergy exemplifies the impact we strive to achieve at All On, innovative solutions, unwavering commitment to sustainability, and a relentless focus on social impact.
- “This investment reaffirms our confidence in their ability to scale their operations and accelerate the adoption of clean energy in Nigeria and beyond.”
