Crowdfunding Boosts Energy Access in Africa

Key Figures & Findings:
Crowd Power, a key initiative by Energy 4 Impact with funding from UK Aid, has significantly boosted crowdfunding for energy access in developing regions. Through this program, debt crowdfunding has raised over $300 million for energy projects since 2016, mainly benefiting SMEs across Kenya, Nigeria, Vietnam, Uganda, and India. Despite a slight drop in 2023, the stability of debt crowdfunding shows its resilience. This capital has predominantly funded solar home systems (SHS) and, increasingly, larger commercial and industrial (C&I) energy projects due to their appealing risk profiles and potential for stable returns.

Statistics & Insights:
In 2023, crowdfunding raised $48 million for energy access, down by 5% from 2022’s $51 million. C&I transactions rose by 14%, reaching $28 million, and reflecting an industry shift toward stable, larger-scale projects with higher risk-adjusted returns.

Future Implications:
With increasing C&I loans dominating the crowdfunding landscape, we could see stronger, sustainable energy access across emerging economies. By adapting to market conditions, crowdfunding could help stabilize financing channels for the energy sector beyond 2024.

Source:  ESI Africa