BNC London: Middleton Q&A – Strategies and insights for SA’s energy future

Andrew Middleton, GoSolr CEO, discussed the significant investments from Standard Bank, an international climate-focused investor, and African Rainbow Capital in his solar energy company. He highlighted South Africa’s energy crisis, emphasising the potential for solar solutions despite current challenges. Middleton advocates for local investment, community involvement, and improving infrastructure to address the country’s power supply issues. He explained GoSolr’s flexible subscription model and its impact on the residential market, stressing the importance of confidence and innovative solutions for sustainable energy and economic growth in South Africa.

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Summary of the Q&A session with Andrew Middleton at BNC London

In a Q&A with Alec Hogg, GoSolr CEO Andrew Middleton discussed the investment and growth prospects of the South African solar energy market. Middleton explained that GoSolr’s expansion is backed by significant investors, including Standard Bank, an international climate-focused investor, and African Rainbow Capital. Despite challenges, he emphasized that confidence and realistic perceptions are key to attracting further investment.

Middleton, originally an actuarial science and investment banking professional, shifted to the solar industry to address impactful infrastructure problems. He noted that solar energy in South Africa faces hurdles, including load shedding, which stems from inadequate investment in power generation and distribution. This issue has profoundly affected the national psyche and economy.

Middleton highlighted the potential of solar energy to transform the South African economy if adequately supported by infrastructure and regulatory frameworks. He advocated for community involvement and sustainable models in deploying solar solutions in informal economies.

Middleton also addressed concerns about the affordability of solar energy, noting that costs are gradually decreasing. GoSolr’s subscription model offers flexibility, with a focus on customer service and quality. He mentioned that recent regulatory changes, such as feed-in tariffs in Cape Town, are promising steps toward making solar energy more accessible and integrated into the national grid.

Edited transcript of the Q&A session with Andrew Middleton at BNC London

Alec Hogg [00:00:07]: Who are the investors in GoSolr, given the substantial investment? What’s driving their interest in the South African economy?

Andrew Middleton [00:00:24]: We’ve been fortunate with our investors. Standard Bank, a major banking partner, joined as a data provider and minority shareholder. Additionally, an international climate-based investor and African Rainbow Capital, listed on the JSE, have recently invested.

Alec Hogg [00:01:20]: It’s interesting that there’s a surge of capital out of South Africa but less coming in. In a typical scenario, sectors like yours would attract more funds. What might trigger this shift?

Andrew Middleton [00:01:50]: Confidence is key. Despite challenges, the perception of problems at home often exceeds reality. The recent energy crisis has spurred investment in industries like ours, driven by confidence in viable solutions.

Alec Hogg [00:02:39]: So, you studied actuarial science but shifted to investment banking. What led to this transition?

Andrew Middleton [00:03:01]: Actuarial science wasn’t my passion. I found investment banking more appealing for its focus on corporate finance and mergers. Eventually, I pursued entrepreneurial ventures aligned with my purpose, particularly in impactful, capital-intensive sectors like solar energy.

Alec Hogg [00:04:14]: Why stay in South Africa when you could have taken your skills elsewhere?

Andrew Middleton [00:04:22]: I have multiple passports but choose to remain in Johannesburg, my home. I believe in addressing our challenges locally and fostering growth in the country that shaped me.

Alec Hogg [00:05:34]: What’s your approach to tackling loadshedding and its impact on society?

Andrew Middleton [00:05:34]: Loadshedding, stemming from inadequate investment in power infrastructure, deeply affects daily life. Our focus is on providing reliable, alternative energy solutions to mitigate its impact and restore hope in the community.

Alec Hogg [00:08:01]: If money were no object, how would you approach widespread adoption of solar energy in South Africa?

Andrew Middleton [00:08:01]: We’d leverage scalable, quality-focused technologies and engage with communities for sustainable deployment. Philanthropic support and innovative financing models could make solar accessible to every household, with a focus on recycling and repurposing materials.

Alec Hogg [00:09:58]: Could informal economy concepts, like waste repurposing, be applied to solar energy?

Andrew Middleton [00:09:58]: Yes, but it requires community involvement and sustainable business models. Building infrastructure in informal economies necessitates collaboration with local leaders and businesses for long-term success.

Alec Hogg [00:11:33]: How can initiatives like Starlink in Malawi be replicated in South Africa?

Andrew Middleton [00:11:33]: Regulatory support and community engagement are crucial. Technologies like Starlink need a conducive environment to thrive, alongside partnerships with existing infrastructure providers.

Alec Hogg [00:17:05]: Are you considering venturing into kinetic energy solutions?

Andrew Middleton [00:17:05]: Currently, our focus is on residential solar. While kinetic energy is promising, we prioritize specialization in smart home and electric vehicle integration.

Alec Hogg [00:17:59]: How do feed-in tariffs benefit solar clients?

Andrew Middleton [00:17:59]: Feed-in tariffs enable households to sell excess power back to utilities, offering a potential revenue stream. While this model is gaining traction, investment in metering infrastructure remains a barrier.

Alec Hogg [00:20:04]: How does your subscription model accommodate home sales?

Andrew Middleton [00:20:04]: Our model transfers ownership to the household, with payment spread over 20 years. Flexibility in transferring or canceling contracts ensures seamless transitions during property transactions.

Alec Hogg [00:22:11]: Why opt for short-term contracts over long-term commitments?

Andrew Middleton [00:22:11]: Short-term contracts align with customer interests and ensure quality service. We believe in providing flexibility and value to customers, rather than locking them into lengthy commitments.

Alec Hogg [00:27:29]: Why the recent slowdown in solar market growth in South Africa?

Andrew Middleton [00:27:29]: Solar adoption is still primarily driven by loadshedding concerns, rather than long-term sustainability. Greater acceptance and integration into the energy mix are needed for sustained growth.

Alec Hogg [00:28:49]: How have solar panel costs evolved in recent years?

Andrew Middleton [00:28:49]: Solar panel prices have steadily decreased, while battery technology continues to improve. Despite rising installation costs, overall affordability has significantly improved.

Alec Hogg [00:31:47]: Thank you, Andrew Middleton, for sharing your insights on the dynamic landscape of solar energy in South Africa.

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