The UN has estimated that universal energy access by 2030 will see an annual investment of $48 billion in renewable and sustainable power, with over half of this directed to Africa. This will create a new asset based class of institutional and impact investment opportunities. Early investors will reap the highest returns, especially in those Africa countries with high economic growth rates exceeding 6%.
Africa Power targets this huge unmet need with affordable PAYG power services, which require no on-going Government subsidies allowing investors a secure, fast growing market potential. In the countries we operate, there are currently no regulatory barrier or constraints on our growth or services, and in some of these countries they have specifically dismantled regulatory controls over small distributed renewable power systems.
With an effectively unlimited accessible market, Africa Power is seeking high growth rates with commensurately higher returns for earlier investors. It offers investors a new play in the successful telecoms market arising from our anchor clients whilst diversifying into rural infrastructure.
Our ABCD(tm) off-grid, rural power model, breaks Africa free of physical hard-wired connections and offers Africa a new power paradigm, much as the cell phone industry (Itself supported by development finance) allowed communications to become ubiquitous without the burden of the expensive land-line infrastructure.
Africa Power is building on proven successes and is taking advantage of the rapid technological changes in solar power. Costs are falling whilst capabilities; quality and longevity increase. High efficient low-voltage DC systems are entering the market at a price point matching or below their mains equivalents. As an installer and operator of sustainable off-grid power, Africa Power does not design nor manufacture its own systems but competitively sources the best value systems and equipment world-wide, passing on technology risk through warranty provisions from its turn-key suppliers.
Africa Power offers a double-diversified growth investment in sustainable energy. Risk is diversified by operating in multiple countries and by having a diversified range of customers and service products arising naturally from the ABCD™ off-grid rural power model. As each client represents an independent power services investment project, any segment which is under-performing, has fewer systems deployed and so becomes a smaller part of the portfolio, thus maintaining average returns. In contrast fast growing well performing segments take a larger portion of the capital deployed where the returns are stronger.