Sun Exchange invites investors to purchase solar cells for as little as $4.
- Sun Exchange invites investors to purchase solar cells, a component part of panels, for as little as $4, on a project of their choice.
- The company has installed panels for more than 60 agribusinesses, schools and shopping malls in southern Africa.
- South Africa has had its worst power outages this year as Eskom struggles to keep its aging plants running.
- for more stories, Go to the News24 Business cover.
When Abraham Cambridge flew to South Africa in 2014, he was surprised by the number of solar panels he saw in a sunny country with little electricity.
Shortly thereafter, he founded Sun Exchange, a company that crowdfunds panel installation, eliminating the need for customers to raise the often prohibitive amount of money required to purchase and install equipment.
“You have to put solar panels in places where you have the biggest environmental and social impact,” says Cambridge, who previously ran a panel installation business in the UK.
“That drew me to South Africa, where you have fantastic solar radiation and growing energy problems.” She zeroed in on schools, retirement homes and shopping malls as potential customers, places that often find solar energy costs prohibitive.
Sun Exchange invites investors to purchase solar cells, a component part of panels, for as little as $4, on a project of their choice. Customers receiving the renewable power still pay a fee for a 20-year contract, but the cost is below what would have been charged for electricity from the grid.
Part of the proceeds goes to Sun Exchange, so you can fund installation and maintenance and make a profit. The rest is paid to investors. They can choose to receive South African Rand or Bitcoin, with the cryptocurrency enabling easy cross-border payments to the more than 35,000 people in 180 countries who have participated so far.
“I bought a couple of solar cells for a Sun Exchange project in 2018, the installation at Sacred Heart College in Johannesburg,” says Nick Hedley, a 34-year-old communications consultant and writer in Cape Town.
“The profits generated since then are equal to 23% of my initial investment. It’s a great operating model.”
South Africa has had its worst power outages this year as debt-ridden state utility Eskom, which generates almost all of its power from coal, struggles to keep its aging plants running.
made in africa
Until recently, there were few alternatives for small businesses and households to finance their own solar power. “What this business model enables is essentially using all the roofs available for solar power, to allow everyone to invest in solar power,” says Jules Kortenhorst, chief executive of the nonprofit research organization RMI.
Sun Exchange has installed panels for more than 60 agricultural businesses, schools, nursing homes, shopping malls, and facilities for the visually or educationally impaired in southern Africa.
One client, Eric Brown, owns a remote farm in the semi-desert Karoo region that is not connected to the grid. It relied on diesel generators, but in September it switched to solar power. He expects his energy costs to drop more than 60%.
“The biggest infrastructure problem is the supply of electricity, because you can’t pump it with diesel, it’s too expensive,” he says.
Cambridge’s first project, in 2016, was the Stellenbosch Waldorf School, which caught the attention of investors in the US.
Initial funding of $60,000 came from Boost VC in California.
Subsequent rounds brought in more than $8.3 million. It took Sun Exchange just three days to raise the 9.5 million rand needed to install panels at the Pioneer School in Worcester, 70 miles east of Cape Town, which teaches around 120 blind or partially sighted students.
“It’s cleaner, cheaper energy, and we sell any excess we don’t need to the municipality,” says Michael Bredenkamp, director of Pioneer.
“We save around R10,000 a month and we are helping the environment.”