MICROCAPITAL BRIEF: SunFunder Raises $42.5m for Solar Energy Transformation Fund from OPIC, Calvert, Ceniarth, IKEA Foundation

SunFunder, a Kenya-based financier of solar energy firms, recently raised USD 37.5 million in debt for its new Solar Energy Transformation (SET) Fund as well as USD 5 million in first-loss grant funding from the IKEA Foundation, an affiliate of the Sweden-founded IKEA group of furniture companies. The goal of SET is to raise USD 85 million to fund the delivery of energy to 3 million people over nine years, avoiding the usage of 480,000 tons of carbon dioxide per year. The target population is people with unreliable or no electricity in Africa and Asia.

So far, the debt funding for SET comprises USD 25 million from the Overseas Private Investment Corporation (OPIC), the development finance institution of the US government; USD 7.5 million from Calvert Impact Capital, a US-based nonprofit lender to “mission-driven organizations worldwide that have a social and/or environmental focus;” and USD 5 million from Ceniarth, a family office operating from three locations in the UK and the US. Since its founding in 2012, SunFunder has lent a total of USD 65 million to 46 solar energy firms.

Established in 1971, OPIC is a financially self-sustaining organization helping US-based businesses invest in low- and moderate-income countries in ways intended to foster economic development while advancing US foreign policy priorities. In particular, OPIC provides financing, advocacy and political risk insurance. During the 12 months ending September 2018, the organization disbursed USD 3.3 billion to new projects, closing the year with active projects in 89 countries and USD 9.6 billion in total assets.

Founded in 1995 as the Calvert Foundation, Calvert Impact invests in companies in the affordable housing, agriculture, community development, education, environmental sustainability, health, microfinance and renewable energy sectors. The organization is active in 100 high- and low-income countries. As of 2018, Calvert Impact’s portfolio of 116 investments is valued at USD 377 million. In 2017, it launched a syndication service through which it has raised USD 79 million as of 2018.

Ceniarth was founded in 2013 and holds investments in funds and individual companies working in sectors such as agriculture, energy access, financial inclusion, healthcare and sanitation.

The IKEA Foundation is a charitable organization founded in 1982 by the home furnishings company IKEA, whose name is an acronym for Ingvar Kamprad Elmtaryd Agunnaryd. The parent organization was founded in Sweden but now comprises entities in the Netherlands, Luxembourg and Lichtenstein. The foundation’s mission is to fund programs addressing four aspects of women’s and children’s lives: home, health, education and a sustainable family income.

Sources and Additional Resources

SunFunder press release
https://sunfunder.com/news/setfundfirstclose

OPIC press release
https://www.opic.gov/press-releases/2019/opic-provides-initial-financing-sunfunders-solar-energy-transformation-fund-expand-access-beyond-grid-solar

OPIC Annual Report 2018
https://www.opic.gov/sites/default/files/files/OPIC-AnnualReport2018.pdf

Calvert Impact Capital homepage
https://www.calvertimpactcapital.org/

Ceniarth homepage
http://ceniarthllc.com/

Ikea Foundation homepage
https://www.ikeafoundation.org/

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