Madagascar Startup, WeLight Raises €19 million with EIB, EDFI ElectriFI and Triodos Investment Management

Today the European Investment Bank (EIB), Triodos Investment Management and EDFI ElectriFI declared their new mutual investment of €19 million to support WeLight Madagascar’s €28 million project in Madagascar. The investment will serve as a catalyst for WeLight to build and develop solar mini-grids to provide electricity to over 120 villages in Madagascar which currently have no access to the electricity grid.

• WeLight Madagascar’s access to energy initiative will receive €19 million in financing from the EIB, Triodos Investment Management and EDFI ElectriFI — the EU-funded Electrification Financing Initiative.
• The financing will be used to build and develop small solar mini-grids in over 120 villages in rural Madagascar, expanding WeLight’s coverage from eight regions to 17.
• The project aims to serve around 250 000 people, providing more than 45 000 households and businesses with first-time access to clean, affordable and productive energy and light.

WeLight existing shareholders AXIAN Group, a Pan-African group specializing in five sectors with high growth potential in real estate, telecoms, financial services, energy and open innovation; Sagemcom, a French industrial group and world leader in high added-value communicating terminals and energy solutions; and Norfund, the Norwegian investment fund for developing countries, collectively bring the remaining €9 million in the form of shareholder loans.

Made up of a solar power plant and energy storage system, a distribution line and a meter for each customer, a mini-grid can supply electricity 24 hours a day, seven days a week. The 120 additional villages cover 17 regions were selected thanks to outstanding work with Madagascar’s Ministry of Energy and the Agency for the Development of Rural Electrification (ADER).

The new mini-grids will provide residents in off-grid rural villages access to clean and affordable energy. Alongside homes and businesses, the project will benefit schools, health centers and public spaces, strengthening the local economy and improving health, security and education.

Currently, around a quarter of the population in Madagascar has access to electricity. Off-grid solar technology has shown beyond doubt to be a reliable solution to further economic growth and continuous development in regions where connection to the grid is still a stretch.

Article Source: European Investment Bank

Romain de Villeneuve, Chief Executive Officer of WeLight Madagascar, said, “This new project will significantly improve rural electrification in Madagascar. It will also positively impact hundreds of thousands of people, greatly enhancing living standards, the local economy and people’s well-being. WeLight has already deployed its solutions in more than 40 rural communities. The EIB, ElectriFI and Triodos, all of them financial experts in this industry for Africa, are now partnering with us to cover 120 additional villages. This is an encouraging vote of confidence in the relevance of WeLight solutions to answer the vital electrification needs of deprived communities.”

Thanks to the support of these allys and with AXIAN Group, Sagemcom and Norfund as its shareholders, and through the operational excellence developed to serve customers, WeLight will give chase to its growth in Madagascar and in other countries in Sub-Saharan Africa where such types of needs are still not answered.

EIB Vice-President Ambroise Fayolle remarked, “This project continues the EIB’s longstanding backing of off-grid solar energy in rural Africa, following successful projects in Benin, Chad, the Comoro Islands, Mozambique and Uganda. I am very happy that we can now implement such a project in Madagascar. Through these projects, the EIB aims to promote the scaling-up of the off-grid solar power model as part of its commitment to fighting climate change while fostering economic development and real improvements to people’s daily lives.”

ElectriFI Senior Investment Officer at EDFI Management Company Maud Watelet added: “This financing represents an important milestone for WeLight, as it will unlock the company’s potential to deploy more than a hundred mini-grids in Madagascar, a market with a significantly low electrification rate and challenging logistic conditions. EDFI ElectriFI’s first-mover role as a potential lender to WeLight has been pivotal to enable the company to attract co-investors in the current round. EDFI ElectriFI is particularly proud of the fruitful collaboration with the EIB and Triodos as co-investors in the project, and with Norfund, AXIAN Group and Sagemcom as sponsors of the company. Together, we share the commitment to bringing off-grid electricity to underserved communities and contributing to socioeconomic growth in Sub-Saharan Africa.”

Also speaking, Fadoua Boudiba, Regional Manager Africa and Middle East at Triodos Investment Management, explained, “The impact of mini-grid solutions is multifaceted. They are crucial in providing low-income households access to clean, affordable and reliable electricity, and they boost socioeconomic development for rural communities. The close collaboration between WeLight, committed shareholders and like-minded impact investors is an essential ingredient to enhance access to energy in rural communities. As such, we are extremely pleased to participate in this impactful initiative from WeLight Madagascar through our investment funds, Triodos Groenfonds, Hivos-Triodos Fund and Triodos Emerging Markets Renewables Energy Fund.”

Isabelle Delattre Burger, Ambassador of the European Union (EU) to Madagascar, commented, “This project is a great example of the positive impact of Team Europe to improve daily life for people in Madagascar. Access to affordable and clean energy for all is an important Sustainable Development Goal and contributes to the green and just transition supported by the EU’s Global Gateway strategy.”

Background information

About the European Investment Bank

Since 1970, The European Investment Bank (EIB), which is the world’s largest multilateral financial institution and one of the leading providers of climate finance worldwide, has lent a total of €893 million to support long-term investments in Madagascar.

The EIB has allocated €6.6 billion since 2002 to financing solar projects globally, with 50% going to emerging and developing economies. This project continues the EIB’s backing of off-grid solar energy in rural Africa, following support for similar projects across the continent

EIB Global is the EIB Group’s new, specialized arm devoted to increasing the impact of international partnerships and development finance. It is designed to build strong, focused alliances within Team Europe, alongside fellow development finance institutions and civil society. EIB Global brings the Group closer to local people, companies and institutions through our offices around the world.

About WeLight Madagascar

Born out of the desire of three leading economic players, AXIAN Group, Sagemcom and Norfund, with a strong expertise in Africa, to develop and roll out renewable energy solutions across the continent WeLight was founded. It provides clean, affordable, reliable and productive energy to people in remote rural areas of Madagascar and Sub-Saharan Africa. WeLight is committed to providing electricity to isolated villages and further contributing to their economic development, WeLight currently operates 40 mini-grids representing 9000 electrified households.

About EDFI ElectriFI

EDFI ElectriFI is an EU-funded impact investment facility, financing early-stage private companies and projects, focusing on new/improved electricity connections as well as on generation capacity from sustainable energy sources in emerging markets. EDFI ElectriFI is managed by the EDFI Management Company, a company established by the 15 European Development Finance Institutions (DFIs).

 About Triodos Investment Management

Triodos Investment Management (Triodos IM) connects a broad range of investors who desire to make their money work for lasting, positive change with innovative entrepreneurs and sustainable businesses doing just that, through serving as a catalyst, Triodos connects a broad range of investors who desire to make their money work for lasting, positive change with innovative entrepreneur and sustainable businesses to build a world that is fairer, more sustainable and humane. It has built up in-depth knowledge throughout 25+ years of impact investing in sectors such as Energy & Climate, Financial Inclusion and Sustainable Food & Agriculture, and also invests in listed companies that materially contribute to the transition toward a sustainable society. Triodos IM is a globally active impact investor with 750+ investments in over 50 countries and €5.7 billion in assets under management (as per end of June 2022). It is a wholly owned subsidiary of Triodos Bank NV, which was founded in 1980 and is a leading expert in sustainable banking.