A new insurance fund aims to minimize financial risk for small solar projects in emerging markets.  

Blockchain-based solar micro-leasing marketplace The Sun Exchange said its Solar Project Insurance Fund (SPIF) is designed to unlock financing for previously financially underserved solar projects in developing regions.

Through an online platform, members can purchase solar PV cells for around $10 per cell and lease them for installation in solar projects serving businesses, hospitals, schools and other organizations in southern Africa, the Middle East and other sunny developing regions.

The new insurance fund safeguards solar cell owners against costs associated with potential project defaults, The Sun Exchange said.

The company has also released a network token that includes a gamified rewards programme designed to guide users towards maximizing the diversification and social impact of their solar cell portfolio. Proceeds from the sale of the network token will be used to finance the fund. 

Larry Temlock, The Sun Exchange’s cofounder and CFO, said the SPIF “is the world’s first crowd-sourced default insurance fund for clean energy projects in emerging markets” and that it “creates a new layer of security and reliability as the company grows, stimulating investment in impactful solar projects.”

And Abraham Cambridge, the firm’s founder and CEO, said: “Small commercial and industrial solar projects can drive urgent economic development by powering organizations such as hospitals, schools, small and medium businesses in developing regions. However, with aid organizations and NGOs primarily funding residential solar, and large banks and financiers only backing large and utility-scale projects, so these smaller but otherwise commercially viable solar projects fall into a major funding gap.”

Cambridge said his firm was “leveraging blockchain and the crypto-economy to further bridge that funding gap and address a very real global challenge that can impact the lives of millions.”