Mirova, a leading European sustainable investment firm, has made its first foray into South Africa, committing $15 million in long-term debt financing to SolarAfrica, a Centurion-based renewable energy developer. The senior secured facility represents a strategic step in Mirova’s mission to support the clean energy transition across emerging markets and forms part of the company’s broader Gigaton strategy.
Founded in 2011, SolarAfrica has established itself as one of South Africa’s preeminent Independent Power Producers (IPPs), specializing in providing renewable energy solutions that reduce electricity costs and bolster energy security for businesses. Initially focused on Power Purchase Agreements (PPAs), the company has since expanded its portfolio to include on-site solar installations, battery storage solutions, and virtual products such as wheeling and electricity trading.
SolarAfrica’s efforts have translated into tangible environmental benefits, having delivered over 204 energy projects that have collectively prevented the emission of more than 295,000 tonnes of carbon dioxide. In 2023, the company further cemented its market leadership by merging with Starsight Energy, creating a clean energy powerhouse operating across Eastern, Southern, and Western Africa.
Mirova’s $15 million investment will serve to bolster SolarAfrica’s commercial and industrial (C&I) renewable energy initiatives and accelerate the development of utility-scale projects. The funds aim to support SolarAfrica’s ambitions to enhance its footprint in South Africa’s renewable energy sector, particularly as the country continues to grapple with electricity shortages and the challenge of transitioning away from coal dependency.
Charl Alheit, SolarAfrica’s Chief Investment Officer, expressed optimism about the partnership. “Mirova’s investment is not only a validation of the work we’ve done over the past decade but also a significant boost to our mission of becoming the leading renewable energy provider in South Africa,” Alheit said. “With Mirova’s support, we’re well-positioned to scale our operations and drive real change in the energy sector.”
The investment in SolarAfrica represents Mirova’s fifth transaction under its Gigaton strategy, which aims to accelerate the global transition to low-carbon energy by investing in renewable energy projects in high-growth markets. Rim Azirar, Deputy Head of Investments at Mirova, highlighted the alignment between SolarAfrica’s expansion and Mirova’s goals.
“South Africa represents a key market for renewable energy development, and SolarAfrica is well-positioned to lead that charge,” Azirar stated. “This investment fits perfectly with our objective to provide reliable, affordable clean energy to emerging markets, while also supporting local economies and contributing to a more sustainable future.”
Mirova joins a growing list of international investors targeting climate-tech and renewable energy ventures in Africa, a continent that has increasingly become a focal point for sustainable development investments.
The Renewable Energy Investment Landscape in Africa
Africa’s renewable energy market, though still developing, has attracted significant international capital in recent years. Funds like Mirova’s Gigaton are part of a broader wave of climate-tech investments that are seeing African startups and projects at the center of global sustainability strategies. Other prominent players in the space include LeapFrog Investments, EchoVC’s Eco Pilot Fund I, and the E3 Low Carbon Economy Fund for Africa, all of which focus on scaling climate-tech solutions across the continent.
LeapFrog Investments, for instance, is deploying its $500 million fund towards climate innovation in Africa, aiming to drive growth-stage companies that offer solutions to financial inclusion and environmental challenges. Meanwhile, smaller funds like EchoVC’s Eco Pilot Fund I and Satgana are taking on early-stage ventures in sectors such as mobility, agriculture, and energy, addressing Africa’s unique environmental challenges.
SolarAfrica ’s partnership with Mirova exemplifies the type of collaboration needed to meet South Africa’s growing energy demands and mitigate the effects of climate change. With chronic electricity shortages, particularly due to reliance on aging coal-fired power plants, the country is poised to benefit from the influx of capital directed at renewable energy solutions.
The growing investment in Africa’s renewable energy sector reflects broader global trends as investors, funds, and corporations increasingly recognize the continent’s potential in the fight against climate change. For SolarAfrica, the collaboration with Mirova marks a milestone in its growth story, with the potential to not only expand its operations but also reshape South Africa’s energy landscape.
As the energy transition gathers pace, more players are expected to enter the African market, providing the financial backing and technical expertise necessary to scale renewable energy infrastructure. SolarAfrica, with its proven track record and strategic partnerships, is well-positioned to lead South Africa’s shift towards clean energy.