SHOW / EPISODE

Equity Investments in Off Grid Solar with Leslie Labruto (Acumen)

37m | Apr 29, 2020

We speak with Leslie Labruto, Head of Energy Access at Acumen, about the equity investment landscape in off-grid solar. We discuss Solar Home Systems (SHSs), minigrids, impact investment, successful business models, challenges and opportunities in the sector, and what makes a great investment for Acumen.


Recorded in 2019

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Show notes:

(0:55) Introduction to Leslie Labruto and how she got into the clean energy sector

(2:20) Introduction to Acumen, their higher risk approach to investments, and commitment to the poor

(3:30) Overview of the off-grid solar sector: pico appliances, solar home systems (SHSs), mini-grids -- the ongoing challenges around mini-grid business model

(6:20) Discussion of the investment landscape in the off-grid solar sector, contrasting Mobisol, d.lights and positive signs from new funds (e.g. KawiSafi and Sunfunder); the need for more early stage investments

(9:20) Acumen's approach to patient capital, investments, 1x returns -- what they look for in an investment

(12:35) Acumen's energy investments to date; the challenge and need for solutions around clean cooking 

(14:30) Productive Energy Use: the opportunities and need for solutions that can support income growth; their focus on Pioneer Energy Investment Initiative (PEII) 

(17:30) The commercial viability of the off-grid solar sector, the need for operational excellence, strong unit economics for successful companies

(19:11) Considerations around exits in the sector: the need for secondary sales to support the growth of the investment sector, the catalytic effect of secondary sales; the role of strategics (e.g. Shell, Total, Engie) in the sector

(22:20) The intentions and interests of strategic, corporate investors in the energy access sector

(23:50) The challenges for the mini-grid sector in particular; the ability for mini-grid sector to target poverty alleviation; the need for subsidies in the mini-grid sector and reframing of mini-grids as a public good

(27:00) Results-Based Financing: demand from investors for RBFs

(29:15) Lean Data, 60 Decibels, and focus on customers to determine the social and environmental impact of products and services; the use of Lean Data for due diligence purposes

(32:50) Geographical areas of focus for Acumen

(35:10) Predictions for the energy access sector: the need for reliability and developments in some geographical areas

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