Impact investing is a major opportunity for developing economies and provides basic services to the poorest people.
More than a billion people still live without access to electricity, according to the World Bank. Living without this necessity has a detrimental effect on their health, education and earning potential.
The World Health Organization, for example, estimates that around 3.8 million people a year die prematurely from illness attributable to household air pollution caused by solid fuels and kerosene used for cooking.
Yet there are solutions to serve those with no access to the grid. Off-grid solar systems, battery storage and solar or bio-powered cooking stoves are transforming the lives of rural communities in sub-Saharan Africa and beyond.
Off-grid systems need financing to achieve goals
Two of the most successful providers include Greenlight Planet, a for-profit firm that designs, distributes and finances solar home energy across South Asia and Africa, and ZOLA Electric, formerly Off-Grid Electric, which uses mobile money to sell solar-powered electricity as a service.
The United Nations’ Sustainable Development Goal 7 aims to ensure access to affordable, reliable and modern energy for all by 2030. Bloomberg New Energy Finance estimates that to achieve this $350 billion is needed: $130 billion for grid extension, $165 billion for micro-grids and $55 billion for solar home systems.
To achieve the goal, financing for clean energy firms like ZOLA Electric is fundamental. Yet for these startups, securing finance is often the main challenge.