The demand for solar energy in Nigeria that has gone through power has increased over the last decade thanks to the deterioration of network credibility and the increase in fuel costs. This is the interest of investors Bitternessa clean technology starting meeting they need. The company has just increased an expansion of the $ 15 million B series (over a $ 3 million B1 round last year), bringing its whole round to $ 18 million.
This increase in demand for solar systems follows significant policy shifts, mainly Removal of Nigerian decades’ age subsidy In May 2023 (the Government’s decision – which was discussed much – ended the practice of covering the gap between global and local fuel prices).
Since then, gasoline prices have increased to almost 500%, making energy generators, once regarded as the most affordable alternative to unreliable power and solar systems despite environmental risks, much more expensive.
The Arnergy stadium has changed with the seasons. “When we started the business, we used Solar as a way to get uninterrupted power, not necessarily to save money. It was not part of a commercial conversation”, founder and chief executive Femi adyemo said to TechCrunch. “Now it’s, because we can clearly show customers how our systems save us monthly either using gasoline, diesel or even the network.”
ADEYEMO started Arnergy in 2013 to provide solar systems to homes and businesses in areas such as hospitality, education, funding, agriculture and health care.
What started as a durable game is now a cost -saving strategy that changes adoption for pure technology supported by Bill Gates’s Breakthrough Energy Ventures (The LED business ARNERGY AD in 2019).
Increasing lease adoption
This adoption is clearer in the company’s lease product, Z litewhich became a key focus after the first series of Arnergy B’s B series last year.
While immediate markets included 60% to 70% of revenue in 2023, they represented only 25% of sales last year. On the other hand, leasing-prior-ownership, where customers pay for constant monthly fees over five to 10 years before the system is possessed, has gained more traction.
One reason for this change is financial access to electricity invoices. Until recently, many people considered long -term leases as more expensive than diesel or gasoline generators. But with the prices of diesel rising after the network’s subsidy and invoices-especially after a new government policy last April This tripled the cost of consumption of electricity for customers with the most stable power -The leasing-before-owned solar energy becomes popular with customers, says Adeyemo.
“Imagine paying ₦ 200,000 (~ $ 125) each month for power. With our product, which falls to ₦ 96,000 (~ $ 60). For over five years, it’s a non-brainer what to save,” the CEO said. He added that many existing customers are returning to double their solar capacity or move completely out of the network as a result.
Arnergy has tripled the customer base of the lease between 2023 and 2024 and expects to develop it 4-5 times this year. Naira’s revenue went up accordingly and is on the right track to quadruple by the end of the year.
Dollars’ revenue, on the other hand, remained flat due to currency devaluation, but Adeyemo said the company manufactures revenue from the B2B2C corporate relations and possible expansion to French -speaking Africa.
Escalation within another government policy
So far, Arnergy has developed over 1,800 systems in 35 Nigerian states, totaling 9MWP solar and 23MWh battery storage.
Arnergy plans to use its new funding led by Nigerian private company Cardinalstone Capital Advisers (CCA) for the installation of more than 12,000 systems by 2029. Breakthrough Energy Ventures as well as British International Investment, Norfund, Edfi MC and all participants in round.
But hitting this goal requires a strategic shift. For almost a decade, Arnergy has handled home sales. Now, it adopts a model based on a partnership with business customers and natural retail stores outside Lagos to reach more customers in the Nigerian market.
Lagos-based Cleanech is in talks to increase the additional local debt from banks and DFISs to support these projects, including Energy-A-A-Service (EAAS) solutions for multinationals, says Adeyemo.
However, as Arnergy is preparing to escalate, a proposed policy could threaten its dynamics.
Last month, the Nigerian government announced plans to ban solar panel imports to enhance local construction. The movement has drawn reactions from stakeholders who argue that domestic capacity is far from ready.
Adeyemo agrees with the goal, but not the approach. He warned that an early ban could stop an industry that is just coming out of the ground.
According to the Managing Director, Nigeria must create an environment with the right infrastructure, policy stability and access to funds so that local factories can increase the next three to five years. Only after that should the country start thinking about removing imports.
“We are supporters for local construction, but let’s build skill before closing the door to imports, otherwise we risk doing more harm than good, both in industry and millions of Nigerians who are now based on solar energy as a primary source of energy,” he noted.
