Starsight Premier Energy, a joint venture between Starsight Energy and Premier Solar, is considering entering South Sudan and Democratic Republic of Congo (DRC), chairman and CEO Rupesh Hindocha tells The Africa Report.

An internal report on the two countries is due by the end of the first quarter. This might lead to external consultants being commissioned, with final decisions between nine and 12 months away, Hindocha says.

The Starsight Premier Energy JV, based in Nairobi, was launched in 2021, when Nigeria’s Starsight Energy bought a 50% stake in the east African business of Premier Solar.

The JV provides solar power and battery storage to commercial and industrial clients in Kenya, Uganda and Tanzania, and will start operating in Rwanda early in 2024.

Demand from existing customers is a key factor shaping expansion decisions. Many of Starsight Premier’s Ugandan customers also operate in South Sudan, Hindocha says.

In DRC, the mining sector would be a focus, and a presence in the east of the country could make sense as the company is entering Rwanda, he adds.

The consideration of new markets remains at an early stage, Hindocha says. “We don’t just fly in and fly out. If we go in, we go in for the long term”, with offices and boots on the ground. Organic growth is the preferred model, he says.

The JV’s ability to provide client finance “has been the real catalyst for our operations”, Hindocha says. Deployment of the company’s solar solutions has been increasing in Kenya as the price of electricity increases and “people are trying to save on grid costs”.

Manufacturing urgency

Premier Solar also operates in the Middle East and South Asia. West Africa-focused Starsight Energy and South African-based SolarAfrica agreed to merge in 2022 to target commercial and industrial customers across the continent.

The Starsight Premier JV is fully funded until the end of 2024, and is always in discussions with development finance institutions about future needs, he says. “We don’t want to be running around trying to raise money at the last minute.”

Prospects for the growth of solar power in east Africa, Hindocha says, are improving due to the willingness of governments to consider the type of wheeling model adopted in South Africa, which allows private generators to distribute power to end users via the grid.

Kenya, Tanzania and Uganda are all examining the merits of wheeling, with Kenya being the furthest advanced, he says.

Some have argued that the model contributes to the weakness of the South African power utility Eskom, as new energy solutions are used by industrial and affluent individual users who pay their bills. Many poorer users, including some South African municipalities, cannot or will not pay.

Grid stability, Hindocha says, is an obstacle to wider wheeling adoption as there needs to be certainty that the infrastructure can cope with new variable power injections. The issue needs to be tackled, and governments are starting to look at a wider picture than supporting state-owned enterprises, he says.

Manufacturing capacity, he argues, needs to be strengthened if African countries are to compete with cheap imports from south and southeast Asia and improve their balance of payments. “The only hindrance to African manufacturers playing on the global stage is power.”

Cheap power for manufacturing is a key way to address mass unemployment, Hindocha says. “Countries are desperate to develop their manufacturing capacity. Without cheap power, you’re fighting an uphill battle.”