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Nithio invests in farming and irrigation technology

26th September 2023

By: Darren Parker

Creamer Media Contributing Editor Online

     

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African energy finance platform Nithio has invested in solar irrigation and farming technology solutions company SunCulture.

The investment was made through Nithio investment vehicle Nithio FI, which is part of the Productive Use Appliance Financing Facility (PUAFF), which catalyses the uptake of productive use appliances across Africa. PUAFF is managed by international non-profit organisation Collaborative Labeling and Appliance Standards Program (Clasp), which improves the energy and environmental performance of appliances and equipment, and Nithio, with support from the Global Energy Alliance for People and Planet (GEAPP).

Nithio’s investment is part of a $12-million syndicated debt facility led by Mirova Sunfunder and financed through its solar energy transformation fund Mirova, through its Gigaton strategy, along with Triodos Investment Management, which together will enable SunCulture to finance inventory and receivables for its Kenyan subsidiary across its productive-use renewable energy products, related appliances and irrigation equipment.

The aim of the investment is to enable SunCulture to reach more customers, especially smallholder farmers who need affordable and reliable access to energy and water for their livelihoods.

“SunCulture’s products have a proven impact on increasing agricultural productivity, income and resilience for smallholder farmers. Through our investment, we aim to support SunCulture’s growth and scale, and contribute to the broader mission of GEAPP to accelerate the adoption of productive use appliances in Africa,” Nithio CEO Kate Steel said on September 26.

SunCulture was founded in 2012 to help solve the daily challenges that smallholder farmers face, including time-consuming manual irrigation or reliance on increasingly unpredictable rains for their crops. Since then, it has designed, manufactured, financed and serviced Internet of Things-enabled solar energy systems and irrigation equipment for smallholder farmers to help them reduce costs and improve productivity.

This has led to SunCulture being able to offer both cash sales and pay-as-you-grow financing through their direct sales channels and distributors. It has also helped the company sell more than 45 000 units to date. In addition, SunCulture has been able to offer VeraSol tested non-battery and battery-equipped solar irrigation systems and expand into new sales regions through direct international market entrance, joint ventures and government partnerships.

“Through this support, SunCulture is primed to deepen its footprint within Kenya, responding to the urgent calls for food security, poverty alleviation, and climate resilience. This partnership empowers SunCulture to place game-changing tools in the hands of vulnerable smallholder farmers, supporting climate mitigation and adaptation at the individual, community and national levels,” SunCulture CEO Samir Ibrahim said.

PUAFF’s stated mission is to increase access to high-quality productive use appliances that enhance the economic opportunities and well-being of off- and weak-grid consumers. The finance facility offers procurement subsidies, capacity-building grants, distributor debt financing, and advisory support focused on credit systems development for PUA companies and distributors.

PUA companies that are eligible in the facility include energy efficient, income-generating appliances such as refrigerators, solar water pumps, agroprocessing equipment, sewing machines, beside others.

The recent recognition of 18 companies through procurement subsidies and capacity-building grants in East, West, and Central Africa highlights PUAFF's efforts towards catalysing positive change. PUAFF's financing will reduce the cost of appliances for end-users by offering discounts on bulk solar appliance purchases and providing financing to distributors, allowing them to offer products on credit.

“The initiative aligns with our mission of promoting sustainable energy solutions that will avert future carbon emissions, while enabling increased access to clean energy and improving livelihoods through economic growth. By lowering the cost of high quality, energy efficient appliances and providing financing, we're enabling jobs and livelihoods for thousands of people supporting a low-carbon future," GEAPP demand, jobs, and livelihoods director Makena Ireri said.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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