Sun Exchange, a South African renewable energy startup that uses a blockchain-based solution to help people generate and sell solar energy, has raised $3 million from ARCH Emerging Markets Partners, London-based private equity firm. This comes it concluded its Series A funding round in which it raised a total of $4 million.
ARCH Emerging Markets Partners counts among its shareholders African Rainbow Capital (ARC), the investment company founded by South African billionaire, Patrice Motsepe. Motsepe founded ARC during 2016 with the stated aim of diversifying investments away from mining and specifically into innovative solutions for the future. So far, ARC has made some notable investments into South Africa's digital-only bank, TymeBank, and telecommunications startup, rain.
“You as an individual are selling electricity to a school in South Africa, via a solar panel you bought through the Sun Exchange. Our platform meters the electricity production of your solar panel. Arranges for the purchasing of that electricity with your chosen energy consumer, collects that money and then returns it to your Sun Exchange wallet.” Abe Cambridge, founder, and CEO of Sun Exchange, is reported to have said.
The renewable energy startup uses a crowdfunding model through which it allows people to sell solar panels in a proposed project as part of fundraising. Once the fundraising target is reached (i.e. all solar panels sold), only then will the solar project start. Currently, the Cape Town-based startup says it has projects in 24 schools, shopping centers and business parks across South Africa.
The growth of companies such as Sun Exchange can be viewed as a reaction to South Africa's growing energy woes. Specifically with the national electricity company, Eskom, battling in recent years to keep up with demand. Renewable energy has been mentioned as a solution, however, it remains to be seen if renewable energies can produce enough energy to meet the demand.
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