Building a Pipeline of Fundable Companies in the Off-Grid Solar Sector Across the Continent

Presenters:

Femi Adeyemo, Co-Founder and CEO, Arnergy, Nigeria

Simusolar, Marianne Walpert, CEO, Tanzania

3E Power, Eric Kariningufu, CEO, Rwanda

Paysolar, Sam Eniojukan, CEO, Nigeria

2

Unlocking Solar Capital Africa 2016 presentation

byFemi Adeyemo, CEO

ARNERGY SOLAR LIMITED

ARNERGY Business Model Summary

4

Designs Own PAYG technology

• Key differentiator

Imports standard elements

• Can choose lowest cost areas

Assembly in-country

• Keeps costs down and creates jobs

Markets & Distributes

• Through distributors, own Solar Angels (Sales Agents)

•One-time:

•Set –up fees

•Product Sales (Outrightly)

•Ongoing:

•Monthly Recharging fees

Sources of Revenue

•Create jobs (direct and Indirect); Household & Business Connections (Energy Access); Household & Business income Savings

•Reduced of GHG Emission

Impacts

• 2year + business operation• Evolved from Outright Payment Solar Solution and Solar Leasing for

Rural & Urban Homes

2013

(Sept-Dec)

2014

Jan-Oct.

2014

Nov- Dec

2016

Jan-April

2016

May- Aug

Company

Formation & Full

Market Studies

Urban Outright Solar Payment Deployment

(Lagos, Calabar, Abuja)

Pilot of Prepaid SHS technology for Rural

Electrification for 25

households

Raise the Seed

Round -$600k.

Deployment of

600 PAYG SHS

Rural Homes.

Receive Grant

Award from UK

DFID -£100k.

Build

distribution

channel with

over 130

trained

agents.

Deployed 2

37.8kWp

Micro-grid

powering 200

Homes in SS,

Nigeria

Super-Launch of

PAYG SHS

Product ranges

Roll-Out of 200

PAYG SHS in

Kaduna,

Northern

Nigeria

Introducing

RANA App

(Mobile

Electricity

Vending App)

for trained

Solar Angel

(Agents)

ARNERGY Business Evolution

2015

Jul- Dec

Strategy: Future Direction

2016:

Ramp-up on SHS deployment

Roll out 20Wp, 80Wp & 250Wp

2017:

Close Out on Series A Funding

- Milestone of ˷10,000 paying customers

- Commercial launch of higher capacity

2018+:

- Nation-Wide Roll-Out in Nigeria

-African markets

-Over 100 thousand systems

Revolutionary PAYG Solar Solution for Homes in Rural & Urban Nigeria

ARNERGY’S KEY HIGHLIGHT: STRONG TRACTIONS• Technology works with or without mobile network

• Over 1000+ Homes & small businesses electrified

• Currently employed 59 Nigerians; including young women PLUS 600+ Local Agents

• Investment Raised:

£100k - DFID/Adam Smith International –Solar Nigeria Program);

$600k – Nigeria Bank of Industry (BOI)

200 stores of large retail chain on up to 1KWp PAYG

SMALL BUSINESS OWNER IN KADUNA

Arnergy is founded and operated to support people, planet and

profits.

Culture : Triple Bottom Line

Proven technology

Great Implementation Team

Social Impact & development

Highly scalable, Replicable & sustainable Business Model

Summary

Femi Adeyemo & Kunle Odebunmi

Email : info@arnergy.com

Telephone Number: +234 807 768 3416

www.facebook.com/arnergy

www.twitter.com/arnergy

www.arnergy.com

Contact

Unlocking Solar Capital

November 1, 2016

Simusolar focuses on Distribution and Financing,Sourcing products from diverse manufacturers

ManufactureSourcing &

PAYG-Enabling

Distribution & After Market

Service

Payment Processing

Credit

DISTRIBUTION FINANCING

Outsource

Simusolar

Simusolar

Mobile Carrier Integration

Mobile Money Integration

10 Sales Staff4 Service Staff

4 Agents2 Partners

Presence in Mara

MwanzaShinyanga

Geita

Max Loan Term: 3 years

16%-30% APR for Financing

NPLs >60 days are Recovered

Simusolar has achieved several milestones

PLATFORMProprietary PAYG Integration (2015)

CHANNELSSales force: 10 + First Pilot Partner for Distribution

CUSTOMERS$150,000 in Sales for 2016 Projected, ~1,000 customers

PRODUCTSHome Systems (2015), Irrigation Pump (2016), Fishing Lights (2016), Salon (2016)

FINANCINGSNV: Results Based Finance Program (2015-Present)DOEN Foundation: Grant + PRI Loan (2016-Present)Unreasonable Institute: Kiva Sponsorship (Fall 2016)

Simusolar differs from other solutions in its product offering, technology platform, and experience

Equipment ExamplesMulti-phone charger, Clipper kit, Fishing Light, Egg Incubator, Pump, Refrigerator

Tanzanian Market

Grid-Connected

No Service

Micro-Grid

Off-Grid

Almost 75% of the market is still

unserved(>30 Million people)

A few ventures crowd out the rest

Investors Other VenturesTop Funded

(90% to top 5)

Simusolar takes a diversified approach

We took 7 years learning the market through TanzSolar, then…• Founders & Angels • Grant & PRI (DOEN)• Results Based Finance (SNV)• Crowd-funding

• Innovative Direct Public Offering of debt in California• Kiva

• Equity is our greatest need • “Crowding out” applies to equity funding, not debt providers• We are educating non-impact investors and funds new to the

impact sector…more difficult but necessary• Currently raising a convertible round• First priced round in Q1 of 2017 ($800,000)

We would love to see

• More Results Based Financing for ventures in operation

• Funds willing to invest in multiple enterprises (future merger or roll-up opportunity?)

• New funds entering the space

• Public-Private Partnerships targeting early stage ventures

• Market-based approaches to reducing risk for private sector investors (guarantees, first-loss tranches, and more)

• More currency risk hedge mechanisms (like TRX / MFX)

Thank you

We exist to improve the quality of life in rural East Africa through access to financing and solar powered equipment.

Go to www.simusolar.com to learn more.

Marianne Walpert: CEO Michael Kuntz, CFA: COODavid Katz, CTO

mwalpert@simusolar.com mkuntz@simusolar.com

dkatz@simusolar.com

Corporate Presentation

Corporate Presentation

Introduction• Snapshot of 3E Power

• Why are we in business?

What Do we Offer?• Primarily a Developer

• Development Phase

Current Portfolio• On-grid

• Off-grid

Contact us

History

3E power, founded in 2012, is a Project

development company, whose main

objective is the structuring and financing

of power infrastructure assets

Global Reach

3E power operates in Africa, with a

specific focus on pre transitioning and

transitioning countries in the Sub Saharan

Africa region

Key Facts and Figures

3E Power counts two major power

projects:

$ 26 million grid Solar PV plant.

Large SHS deployment at seed stage

development.

Services & Solutions

Acting as a Project developer and

transaction advisor, allocating resources

i) to develop projects from the idea stage to

the bankable stage and

ii) to facilitate the required financing in

debt and equity

Key References

3E Power has taken part in the following

selected flagship projects:

Goldsol II 11.2 MWp Solar PV plant in

a JV with Gesto Energia (Portugal) and

TMM Renewables (South Africa),

Rwanda

Off-grid expansion (130,0000 SHS) in a

JV with Rahimafrooz Renewable

Energy ( Bangladesh), Rwanda

Snapshot of 3E Power

3E Power primarily role is to develop projects from the idea to realization

In addition, 3E Power can still be involved after financial closure to ensure project completion and then after to assist in the management and optimization of the structure

Project preparation

Financial Close

Monitor Construction

Manage relationship with banks

Contractual Management Follow up operations

Maximize profit

Exit strategy

Primarily a Developer

Capturing the Risk Premium

Development activities lead to capturing the high premium associated with the early stage funding of project preparation activities and typically amount 4-10% of the total project cost.

3E Power provides services throughout this essential and complex process of:

• Commissioning prefeasibility and feasibility studies

• Acquiring land and/or rights

• Negotiate core contracts (PPA/CA/GG)

• Tendering and contracting EPC, O&M contracts

• Approaching equity partners and negotiating shareholder agreements

• Approaching lenders and conducting due diligence ( financial, technical, legal, market and insurance review)

Joint Development with Third

Parties

3E Power can also leverage its

network to source strategic and/or

financial partners with relevant

sector know-how or financial

muscles. While 3E Power will

bring its expertise in project

structuring, the strategic partner

will provide development capital

and equity support.

The allocation of development

capital to a project will typically

occur through a Joint

Development Agreement (JDA) to

be negotiated with the assistance

of 3E Power.

Typical Risk & Reward Allocation

over time (IRR)

80++% Development

Premium

18-23% Construction

Premium

14-16% First years operation

Premium

12-14% Years 6++ operation premium

Development Phase

Milestones

• Binding agreement with the Government of Rwanda with access to subsidies and incentives mechanisms

• Technology Supplier Agreement in advanced stage of negotiations

Needs

Seed funding to

• R&D and market analysis

• develop a valued proposition/business planning

• pilot phase and market entry

Off-grid: Solar Home Systems 3E Power in partnership with Rahimafrooz Renewables Energy have entered into a

cooperation agreement with the Government of Rwanda to deploy 130,000 SHS in the

country in the next couple of years.

Current Portfolio

• Access to talent ( Sales/distribution, Engineering, Business development, Finance)

• Product development/Enhancement

• Business Modeling ( Scale up approach with entry level for basic lighting to systems with additional appliances)

• Fund inventory and supply chain management

• Working capital

Thank You

“ What if we mobilized the

resources, scale, and scope of large

firms to co-create solutions to the

problems at the bottom of the

pyramid (BOP), those 4 billion

people who live on less than $2 a

day? “

Dr C.K Prahalad, The Fortune at the

Bottom of the Pyramid: Eradicating

Poverty Through Profits

Email: Erick@3econsulting.coTwitter: @ekariningufu

Panel discussion• Michael Gera, Managing Partner & Co-Founder, Energy

Access Ventures

• Lesley Marincola, CEO, Angaza

• Lawrence Riungu, Portfolio Manager, Acumen

• Patricia Safo, Solarkiosk Ghana and JSC Investments

• Moderator: Arthur Itotia Njagi, Lighting Africa, IFC