Solar solutions provider Candi Solar is offering a financing model to companies who cannot afford the significant upfront expenditure for solar energy installations. The initiative addresses a pressing need in the South African market, where conventional financial instruments fail to effectively address more than 90% of companies, says cofounder and FD Fabio Eucalipto.

He adds that it is “a gap that Candi Solar is eager to bridge”.

Eucalipto notes that 2023 was a “challenging year” for South African businesses with loadshedding levels reaching record highs, highlighting that the year received more loadshedding than the previous ten years combined, which he notes “makes it clear that grid energy is simply no longer reliable”.

Many people and businesses have therefore been seeking alternative methods for keeping the lights on and solar installations are “an obvious choice”, considering South Africa’s abundance of sunlight.

However, the upfront capital, especially for small-, medium-sized and microenterprises (SMMEs), and the need to find reliable engineering, procurement and construction providers remain challenges in the market.

Candi Solar, in this regard, provides flexible solar financing, and carries the solar risk for customers by overseeing the installation, and the system’s operations and management with its team of expert in-house engineers.

“The business case for solar is clear but the capital is missing. This is a key gap in the market which Candi Solar seeks to address,” explains Eucalipto.

He adds that while the company is “a relatively new entrant in the South African market”, Candi Solar offers customised solar and battery storage solutions.

Originating in Switzerland, and backed by Swiss expertise and ingenuity, Candi has already raised about $80-million in funding, out of which $25-million is earmarked for South Africa.

This figure is anticipated to double this year, targeting the Global South, or developing countries, notably India and South Africa.

India, specifically, is the third largest consumer of fossil fuels in the world – behind China and the US – and South Africa also features in the globe’s top 20 consumers.

“You also see a big difference in the size of the companies in the Global South, compared with the Global North,” says Eucalipto.

In the Global South, most companies are SMMEs, with more than 90% in South Africa such companies, whereas in the Global North the economic power comes from large corporates.

“If you don’t address the challenges faced by SMMEs, you’re not addressing some of the key macroeconomic challenges in countries in the Global South,” Eucalipto states.

He explains that conventional investment focuses on generating a financial return whereas “impact investment” achieves financial returns alongside social and environmental impact, typically aligned with the United Nations’ Sustainable Development Goals.

Examples include achieving reduced carbon emissions and additional employment opportunities for women, among many other positive impacts.

In essence, he adds that impact investment extends beyond the investor to provide greater returns for more stakeholders.

“If you want to create development for the entire economy, you need to shift your focus from a conventional, financial-return-focused investment point of view to a more holistic, impact-driven investment point of view,” he says.

“When we invest in countries in the Global South, we help to stimulate productivity and profitability. The knock-on effects not only contribute towards an increased gross domestic product, but also lead to a reduced dependency on fossil fuels, and a reduction in harmful environmental effects,” Eucalipto concludes.

The Candi Solar stable thus far consists of 156 installations, equating to over 88 MWp in size.