Sankalp Forum: Hi Peter, we are glad to have you with us today, and as a partner for the 4th Sankalp Africa Summit. Let us start our conversation, can you share with us a brief background of your experience and what has brought the Canopus Foundation to operate in West Africa?
Peter Heller: Canopus is a private family foundation dedicated to the mitigation of poverty and the promotion of energy access for low-income communities. We have developed Canopus` mode of operation – as a provider of seed money and business development assistance to those most in need – over the last 16 years, moving regionally from South America to South Asia, further to South East Asia and now to Africa. We have noticed that social enterprises in West Africa are heavily underserved by foundations and impact investors compared to the Eastern part of the continent.
Sankalp Forum: Nigeria is the largest market in West Africa, and the country has been particularly affected by the drop in the price of oil. Has this slowed down your operations in the region and do you see this economic slowdown as an opportunity for renewable energy to gain ground in West Africa?
Peter Heller: We haven’t been active in Nigeria so far, but carefully observe the situation in the country and its neighbours. Apparently, the low oil price has no detrimental impact on the dissemination of small solar home systems. Solar and wind energy is so inexpensive today that conventional, fossil-fuel based technologies of power generations can hardly compete, regardless of any pre- or post- “peak oil” scenario. More and more young social entrepreneurs take on the challenge and start new companies along the renewables value chain, they deserve to be nourished by patient capital and professional advice.
Sankalp Forum: At Sankalp, we strive to support entrepreneurs and facilitating the creation of an ecosystem that allows companies to scale their operations and hence their impact, where do you see the main gaps in the West African Ecosystem?
Peter Heller: Based on our experiences in other regions and continents we are not unfamiliar with the challenges we see in the region: limited freedom for private sector players, in some places a difficult civil security situation and rampant corruption, political risks which are almost impossible to mitigate. A massive effort has to be made by true “impact first” investors and venture philanthropists to build more pillars for an ecosystem so desperately needed by communities in West Africa. But there is an incredible entrepreneurial spirit visible wherever I have been in the last years, be it Senegal, Ghana, Côte d’Ivoire or Tanzania.
Sankalp Forum: Off-grid energy solutions present an excellent opportunity to end energy poverty in rural areas, which business models do you see more successful in the market today?
Peter Heller: I am impressed that over the last ten years manufacturers of small solar PV devices in the $15-50 range have done really well, to mention D.Light, Greenlight Planet and Barefoot Power among others. The business models of “pay as you go” have been very successful, too, there is a growing convergence of IT and clean energy products and services which provide new exciting investment opportunities. The mobile phone industry has just started to understand this, sooner or later we might see a wave of strategic investments from their side into the renewables sector. Another field we are currently focusing on is the implementation of larger “micro-grids” in rural areas, providing more than just basic energy access, but opening a door for productive use and income generation.
Sankalp Forum: Where are you focusing your efforts in deploying patient capital for social enterprises and what are the goals of the Canopus Foundation for the near future?
Peter Heller: We are playing both sides, impact investing and non-profit support activities. Over the last five years, Canopus has mobilised approx. EUR 15 million by structuring and refining financial solutions for our partner companies in South Asia. Our near-term goal is to replicate our model in West Africa. The attention of impact investors in moving into the region has grown significantly in the last years. We think the timing of our initiative at the Sankalp Forum this year is adequate to the dynamics in the financial markets here.
Thank you for your time Peter, and we look very much forward to keeping interacting with you at the 4th Sankalp Africa Summit, the 23rd and 24th of February 2017.
For our readers interested in joining Peter at Sankalp Africa Summit we remind the session on Energy Entrepreneurship with a spotlight on energy access in West Africa. Please check our Summit agenda for details.