ESG and Africa’s Unlisted Companies: 100 million lives transformed

Part 2 of our ongoing series on ESG and Africa’s unlisted companies

(This article forms part of KudosAfrica’s just-published 2020 ImpactAfrica Report. Download a free copy here.)

100 Million lives transformed by clean, reliable energy

By Ned Tozun, co-founder and CEO of d.light

Just outside Nairobi, Kenya, the Mutuku family lives only 600 meters from an electrical utility transformer—yet they do not have an electrical connection. Instead, John Mutuku Kiilu, his wife Penina, and their three children relied on two kerosene lanterns for light.

But kerosene is a dangerous and dim light source, leading to respiratory illnesses, burns, and fires for millions of families worldwide. And kerosene is expensive. The Mutukus spent about KES 500 each week on kerosene oil; even then, they had to use it sparingly.

Then, in 2017, they learned about a new energy solution: a pay-as-you-go solar home system. The D30 system can power three bright LED lights, a radio, a mobile phone charger, and a torch. John and Penina paid an upfront cost of KES 2,565 (the equivalent of $25), and ongoing payments of KES 280 shillings (the equivalent of $2.80) per week.

Now, two years later, the Mutuku family has fully paid for the system. They have free, continuous access to reliable solar energy for years to come—and their lives have been transformed. Their health has improved. They experience significant savings. And their children have achieved high marks in school, thanks to the ability to study under bright, safe light every day.

Similar stories are taking place all around the world, where off-grid families are permanently discarding kerosene and other unreliable sources of light and power for clean, reliable energy. The 1.2 billion people across the globe who lack a grid connection no longer have to wait for energy infrastructure that may take decades to arrive. They are empowered to generate their own electricity today, allowing them to use some of the most innovative and energy-efficient products available.

Energy is so essential that the United Nations has established access to affordable, reliable, sustainable, and modern energy for all” as one of its sustainable development goals.

At d.light, we are proud to be the market leader in designing and distributing high-quality solar solutions for communities that lack reliable electricity. We offer a range of products, from a US$4 solar-powered study lamp to pay-as-you-go home systems that can power a broad range of electronics, including a flat-screen television.

From the first days of the company in 2007, our customers have been at the centre of what we do. The needs and desires of off-grid consumers continue to be a central value for our entire team. What our customers tell us determines the design of our products, our sales and distribution strategies, our financing approaches, and our after-sales service.

My co-founders and I also wanted to prove a new model for sustainable development. When we founded the business we initially set ourselves up as a for-profit business with a strong social mission because we knew that would hold us accountable for maintaining high-quality standards at competitive prices while giving us access to capital that would allow us to scale.

Since then we have proved the business can be profitable and have raised US$100 million of financing from some of the world’s leading impact investors, banks, development institutions, and commercial investors. In December 2018, Inspired Evolution, an Africa-focused investment advisory firm that specializes in the clean energy sector, led a US$41 million equity investment into d.light from its Evolution II Fund and other consortium partners including Dutch Development Bank FMO, Swedfund, and KLP Norfund. Evolution II Fund’s current investors include the FMO, Global Energy Efficiency and Renewable Energy Fund (“GEEREF”), Swiss Investment Fund for Emerging Markets (“SIFEM”) managed by Obviam, African Development Bank (“AfDB”), Swedfund, the Finnish Fund for Industrial Cooperation (“Finnfund”), Cyane Holdings, Morgan Stanley Alternative Investment Partners (“MS AIP”), Ascension Investment Management (“AIM”),the European Investment Bank (“EIB”), CDC (UK DFI) and KLP NorfundInvestments AS.

d.light is on the cusp of reaching an even more significant milestone: our 100 millionth customer and we celebrate this milestone because 100 million individuals using solar energy translates into wide-scale, societal-level impact. The planet as a whole benefits. With 100 million off-grid customers switching to solar, more than 165 gigawatt hours of renewable energy has been generated and more than 22 million tons of CO2 offset. There are entire villages in Africa and Southeast Asia using d.light products. The illumination across these communities represents far more than safe and reliable light; it also represents hope and an enhanced quality of life with improved health and safety, education, economic opportunity, and stronger families.

Each of the 100 million lives impacted by d.light solar has a story behind it, just like that of the Mukuku family. Customers tell us how they have been able to expand income-generating activities. Others have seen vast improvements in their children’s academic achievements. Some have even had the opportunity to watch television for the very first time.

On a global scale, 21 billion hours of productivity have been enabled because of d.light products. More than twenty-five million children are studying under the light of a solar-powered lamp. And customers have saved at least US$4 billion in energy-related costs, which can be put toward critical needs like education, health, and income-generating activities.

But in our day-to-day work at d.light, our commitment remains to the individual customer. If you ask any member of our team, they can tell you about at least one specific customer whose life was positively impacted by our products: the shopkeeper who was able to attract more customers; the father who cried at being able to provide electricity for his family; the widow who made an income off of charging her neighbors’ mobile phones; the child who graduated at the top of their class after studying under a d.light lamp.

From Kenya to Benin, and from India to Haiti, d.light remains dedicated to providing the best, most innovative solar solutions to off-grid customers. We’ve seen firsthand how access to clean, reliable electricity can open up a breadth of possibilities for families—and it is our great privilege to play a part in that journey.

This article forms part of KudosAfrica’s just-published 2020 ImpactAfrica Report. Download a free copy here.

This contributed article reflects the views and opinions of the author and not necessarily those of Africa Capital Digest.

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