French gas company Engie has bought Ugandan solar systems company-Fenix International, in a move aimed at expanding its presence in sub-Saharan Africa to provide power to millions of homes without access to electricity.
Engie said on Thursday that it had acquired Fenix International, which sells home solar kits financed through mobile money platforms in Uganda. It did not however disclose the details of the deal including the cost involved.
Engie has 3,000 megawatts of renewable energy and gas-fired power assets in operation or under construction in Morocco and South Africa. Its Tractebel business sells energy services across Africa, but the group has no retail customers in the region.
Engie Africa Chief Executive Bruno Bensasson said Engie will help Fenix to expand in 10 Sub-Saharan countries such as Zambia, Kenya, Ivory Coast, Senegal and Ethiopia among others. “Our ambition is to cover millions of clients,” he said.
Engie had revenue of 66.6 billion euros (US$79 billion) last year, but Bensassson said the company expects double-digit growth, with earnings partly from the new acquisition.
Fenix CEO Lyndsay Handler said its systems cost between US$175 and US$800 and the company has sold them to more than 140,000 Ugandan households in the past three years, bringing power to about 900,000 people.
Handler said there are many solar panel vendors in Africa, but most people are unable to buy the equipment outright.
People in regions without electricity spend 10-50 U.S. cents on energy per day, whether on candles, kerosene or wood, she siad. Fenix has structured its financing around that level.
Customers pay US$8 deposit to take home a basic solar system and are given seven days of free use, after which they must make their regular payments to unlock the system with a code sent by SMS.
“We match financing to what people can spend, this way they gradually replace kerosene with clean energy,” Handler said.
Fenix also provides loans for second or third solar panels, for batteries and even for lights, radios and TVs.
Late last year Engie competitor EDF announced a joint venture with Tanzania-based Off Grid Electric to sell solar panels and batteries in West Africa, also with payments through mobile phones.
Meanwhile, Kenya-based M-KOPA, has connected more than 500,000 homes to solar power and is adding 500 homes every day. It is a strong competitor in the market.
The International Energy Agency says that about 600 million people in sub-Saharan Africa have no access to electricity, as most countries have no enough hydropower dams to provide electricity.