Absa, Sun King partner to power Kenyan communities with off-grid solar

Absa Kenya, in partnership with Sun King, is making a significant investment of Ksh2 billion in the development of solar-powered projects for off-grid communities in Kenya. This collaboration aims to provide clean and efficient energy solutions to households that are not connected to the national grid. James Agin, Corporate And Investment Banking Managing Principal at Absa Kenya, shed light on this groundbreaking initiative during a recent interview on CNBC Africa. The participation in the Ksh2 billion off-grid power project is a collaborative effort between the private sector and the public sector. By working closely with Sun King, a leading solar off-grid provider, Absa Kenya is facilitating the distribution of solar-powered energy to communities that lack access to the national grid. This initiative is already benefitting over 300,000 households, with plans to further expand its reach. One of the key innovations driving the success of this project is the 'pay as you go' model. Unlike traditional solar power systems that require upfront capital investment, the pay as you go scheme allows consumers to access clean energy without incurring substantial initial costs. This approach not only makes clean energy more affordable and accessible but also eliminates the need for diesel-powered generators in rural communities. The removal of subsidies on diesel has further incentivized the uptake of this solar technology, as consumers now have a cost-effective and environmentally friendly alternative. The partnership between Absa and Sun King is not only benefiting households but also revolutionizing the financial model of the off-grid solar sector. One of the standout features of this collaboration is the securitization of receivables, which enables Sun King to access future cash flows upfront. This mechanism accelerates the rollout of solar infrastructure, allowing for faster expansion into underserved communities. By leveraging innovative financial instruments, Absa and Sun King are streamlining the delivery of clean energy solutions to off-grid areas. A key aspect of this initiative is the engagement with the public sector to identify regions where traditional power grids have yet to reach. This public-private partnership is strategically ensuring that clean energy solutions are deployed in areas with limited access to electricity. By complementing the efforts of the public sector, the private sector is catalyzing the adoption of solar power technologies across the country. While the project primarily targets households, the affordability and scalability of solar technology make it a viable option for commercial and industrial use in the future. As advancements in solar technology drive down costs, the potential for broader applications of off-grid solar systems in various sectors becomes increasingly promising. Despite challenges related to low consumption rates and returns in off-grid solar projects, the evolving financial models and decreasing costs are making this sector more financially sustainable. The scalability of solar-powered solutions has the potential to transform how communities access energy, driving both environmental and social impact. The partnership between Absa Kenya and Sun King exemplifies the power of collaboration in advancing clean energy access in Kenya. By harnessing the potential of solar technology and innovative financing mechanisms, this initiative is not only lighting up homes but also illuminating a path towards a more sustainable energy future in the country.