Solar demand for electric vehicles in Nigeria has soared over the past decade due to rising grid reliability and fuel costs. This has attracted the interest of investors ArnergyClean Technology Startup Conference Needs. The company has just raised $15 million in Series B extensions (except for $3 million B1 round Last year), it totaled $18 million.
The surge in demand for the solar system followed a significant policy shift, most notably Cancel Nigeria’s decades-old fuel subsidy May 2023 (The government’s decision – long debate – covers the gap between global and local fuel prices).
Since then, gasoline prices have risen by nearly 500%, making generators once considered a cheaper alternative to unreliable grid power supplies and solar systems that are expensive to operate despite environmental hazards.
As time goes by, Arnergy’s tone changes. “When we started our business, we used to position solar as a way to gain uninterrupted power, not necessarily to save money. It’s not part of the business conversation,” founder and CEO Femi Adeyemo Tell TechCrunch. “Now is because we can clearly show customers how our systems save them monthly, whether it’s using gasoline, diesel or grid.”
Adeyemo launched Arnergy in 2013 to provide solar systems for homes and businesses in the fields of hospitality, education, finance, agriculture and healthcare.
Starting with flexible gaming is currently a cost-saving strategy that changes by Bill Gates’ Breakthrough Energy Adventure (Company Leader Arnergy’s $9 million Series A In 2019. )
Rentals to more and more adoptions
The company’s most explicit adoption of the company’s rental products, Z LiteThis has become the core focus of attention Arnergy’s first series b tranche last year.
While full purchases account for 60 to 70% of revenue in 2023, they accounted for only 25% of sales last year. On the other hand, lease-to-own rental companies pay a fixed monthly fee of more than 5 to 10 years before owning the system, thus gaining more appeal.
One of the reasons for this change compared to electricity bills is affordability. Until recently, many people thought that long-term rentals were more expensive than running diesel or gasoline generators. But as diesel prices soared, Sur province’s revocation came on the grid tariffs, especially after the new government policy was formulated last April Electricity consumption costs for customers with the most stable electricity– Adeyemo said that leasing to your own solar energy has become increasingly popular among customers.
“Imagine paying 200,000 (about $125) of electricity per month. With our products, it goes down to 96,000 (~$60). In five years, it’s effortless,” the CEO said. He added that, therefore, many existing customers are returning to double their solar capacity, or therefore completely off-grid and switch completely.
Arnergy tripled its rental customer base between 2023 and 2024 and is expected to grow 4-5 times this year. Naira’s revenue has climbed accordingly and is expected to quadruple by the end of the year.
On the other hand, U.S. dollar revenue has remained flat due to currency depreciation, but Adeyemo said the company is building FX revenue through a USD-denominated B2B2C partnership and potential expansion to Francophone Africa.
Extend in another government policy
So far, Arnergy has deployed over 1,800 systems in 35 Nigeria states, totaling 9MWP solar and 23MWH of battery storage.
Arnergy plans to use its new funding, resulting in the installation of more than 12,000 systems by 2029 by Nigerian private equity firm Cardinalstone Capital Capital Advisers (CCA). Breakthrough Energy Ventures and UK International Investment, Norfund, Edfi MC, and all participated.
But hitting that goal requires a strategic shift. Arnergy has handled sales internally for nearly a decade. Now, it is adopting a partnership-driven model with corporate clients and brick-and-mortar retail stores outside Lagos to attract more customers in the strong Nigerian market.
Adeyemo said Lagos-based Cleantech is in talks to raise additional local debt from banks and DFIS to support these projects, including Energy Services (EAAS) solutions for multinational corporations.
However, as Arnergy prepares to scale up, the proposed policy could threaten its momentum.
Last month, the Nigerian government Announcement of plans to ban solar panel imports Promote local manufacturing. The move has drawn strong opposition from stakeholders who believe domestic capabilities are not ready yet.
Adeyemo agrees with the goal, but disagrees with the approach. He warned that premature bans could stagnate a fledgling industry.
According to the CEO, Nigeria needs to build an environment with the right infrastructure, policy stability and capital access so that local factories can grow over the next 3 to 5 years. Only after that did the country begin to consider gradually phase out imports.
“We advocate for local manufacturing. But let’s build capacity before closing the door to imports. Otherwise, we risk that the harm is more than good to the industry and millions of Nigerians who now rely on solar energy as their primary energy source,” he said.
