Daystar Power, a Nigerian solar energy provider, has raised $38 million with the support of Investment Fund for Developing Countries and Morgan Stanley Investment Management to expand solar access across West Africa.
Lagos-based Daystar plans to replace “unreliable grid or too expensive, polluting diesel generators,” with clean reliable power, Jasper Graf von Hardenberg, the company’s Chief Executive Officer and Co-founder said in an emailed statement Tuesday.
The company plans to expand its installed power capacity to 100 megawatts from the current 23 megawatts, it said. The injected capital will allow Daystar Power to accelerate its growth in key markets like Nigeria and Ghana, and open up in countries such as Côte d’Ivoire, Senegal and Togo.
Private sector players dominate solar hybrid development in most parts of West Africa, with financial backing from development finance institutions, BloombergNEF said in a July 2020 report. Nigeria, seen as the largest potential market for mini-grid in West Africa, has received at least $374 million in the past ten years from international donors for mini-grid development.
Africa’s largest economy has small-grid capacity of 2.8 megawatts as of 2019, with 52 of the 59 projects solar-powered, according to BloombergNEF. Only 55% of the nation’s population is connected to the national electricity grid and those experience frequent power cuts of up to 15 hours per day.
STOA, a French impact infrastructure fund and one of Daystar backers, seeks to invest over 50% of its capital in renewable energies across Africa, according to the statement. The joint stock company has an initial share capital of 240 million euros.