Urban Volt borrows €36m to fund solar expansion

‘Transformational’ loan will allow green energy supplier meet fast-growing demand

Green energy supplier Urbanvolt is borrowing €36 million to fund further expansion in Ireland and Britain.

Urbanvolt finances and installs solar panels for industries, selling the electricity generated to them at a 30 per cent discount to traditional power suppliers.

The company said on Tuesday that it was raising a €30 million, seven-year loan from Swedish fund, PCP and borrowing €6 million from existing backers BVP and Beach Point Capital.

Urbanvolt will use the cash to fund the installation of solar panels and related equipment in commercial and industrial premises in the Republic and the UK.

Kevin Maughan, co-founder and chief executive, predicted that the "transformational" deal would allow Urbanvolt to grow at a pace allowing it meet significant demand.

“This first funding facility from PCP will see our project output grow by 20 times over the coming years,” he said. “It is also happening at a time when the demand for renewable energy is rising significantly given climate and geopolitical crises.”

Mr Maughan said the cash would allow it supply solar equipment to 200 new customers. The company has already signed up 70 of these, and has had queries from more than 400 interested clients in total.

Declan Barrett, chief operations officer, said the company had 95 further customers at or close to the decision stage. "Seventy-five per cent of companies that get to that stage close," he added.

Skilled workers

Mr Maughan said the company had no difficulty getting the skilled workers needed for solar installation as the volume of business it was doing made it attractive for the bigger contractors.

Urbanvolt's customers include brewer Heineken, pharmaceutical giant Pfizer and medical device manufacturer Zimmer Biomet.

Henrik Bjerklin, PCP's managing director, noted that Urbanvolt was aiding industry's move to more sustainable energy consumption.

Urbanvolt began in 2015 supplying energy-saving lighting equipment to businesses. It launched its solar operation last year. It has contracts with more than 60 companies and has completed seven installations to date.

Mr Maughan said that a possible stock market launch remained on Urbanvolt’s agenda in the longer term.

“That’s still on the cards, it’s something that we will look at in the future,” he confirmed. He pointed out that the company had established structures from the beginning that would make a flotation “less of a leap” than for other businesses.

In the meantime, it could seek further cash from PCP once it has worked through the projects the money raised on Tuesday will fund.

PCP's funds focus on green energy and sustainable businesses. Last year the Swedish investor backed Limerick Polymers, which has built the Republic's biggest facility for sorting plastic waste for recycling.