Why Haiti is full of opportunity for off-grid energy companies
By Jean-François Péan, Senior Investment Manager with Bamboo Capital Partners and OGEF team member, and Stephanie Nsom, consulting energy specialist, World Bank
Haiti is likely to attract more and more solar off-grid companies in 2020! Haiti’s growing energy needs combined with low electrification rates are creating unique opportunities for dynamic off-grid companies. Off-grid companies can benefit from an expanding consumer market and a comprehensive support infrastructure established by the Haitian Government, in close partnership with the World Bank and with funding support from the Clean Technology Fund.
The USD 17.22 million Off-Grid Electricity Fund (OGEF) was launched in March 2019 with the goal of providing equity and debt financing and market development support to commercially viable businesses and enterprises that can provide modern energy services in rural and peri-urban areas of Haiti. OGEF is also setting up a Results-Based Financing (RBF) grant scheme for solar distributors which will be launched in 2020 to further accelerate market penetration.
OGEF is co-managed by Bamboo Capital Partners (BCP), a global impact investment firm with extensive experience in energy access, and Fonds de Développement Industriel (FDI, Industrial Development Fund in English), a Haitian development finance institution. A dedicated team on the ground and international experts in energy access actively support companies to establish and grow operations in Haiti. The OGEF team will be part of the Haitian delegation at the Global Off-Grid Solar Forum and Expo in Nairobi from 18th to 20th February, 2020 to engage with interested businesses, stakeholders and potential partners.
This is why OGEF and his partners believe there is a large opportunity in Haiti for solar distributors:
ü Haiti is a country of 12 million people with a 5% rural electrification rate. GDP per capita stands at USD 868 as of 2018 (higher than in several comparatively developed off-grid markets in Africa).
ü Remittances flow to Haiti reached USD 3.2 billion in 2018 providing rural markets with liquidity and potential earnings in hard currency for distributors.
ü Solar kits and panels are import duty exempt.
ü There is a thriving solar rooftop market due to the dire state of the public utility company; recent fuel shortages have further negatively impacted the fossil fuel-based generation both on-grid and off-grid, driving more and more Haitians to solar – including urban and peri-urban populations.
ü There are only a few existing solar distributors in Haiti which is partly due to the fact that there was no support infrastructure in the past and partly due to the geographic isolation of Haiti far away from other off-grid markets in Sub-Saharan Africa; hence, solar distributors today face little market penetration and competition in Haiti.
ü An RBF grant scheme for solar distributors (focus on Tier 1 access) is currently being developed by OGEF and expected to be launched mid-2020.
ü OGEF is ready to invest equity and debt in solar distributors in Haiti with the goal of helping companies to grow their operations and creating a thriving off-grid energy sector.
OGEF is ready to invest. There is no better time for solar distributors in Haiti than now and we encourage Forum participants to engage with OGEF and seize this window of opportunity. OGEF will also participate in a panel B1 on Public Funding Trends, Past, Present and Future and we encourage interested companies to attend the panel discussion on Tuesday February 18th at 1:30PM. On Wednesday (2:45-3:30pm, room Mount Kenya D), Haiti will present at the country sessions on “Off-Grid Solar Market in Haiti: Targets, Policies and Opportunities”.
To set up a meeting with the OGEF team at the Nairobi Forum 2020, please get in touch with Mr. Jean-Francois Péan: firstname.lastname@example.org.
The Haitian delegation is led by Mr. Nicolas Allien, Coordinator of the World Bank SREP/CTF projects at the Energy Cell / Ministry of Public Works, Transportation and Communications (MTPTC): email@example.com.