Renewable energy finance accessibility for empowering SMMEs participation in the energy sector

Abstract

Given South Africa need for sustainable energy solutions, and access to reliable energy studying the role of project finance in supporting SMMEs is essential. Accessible renewable energy finance for Small, Medium, and Micro Enterprises (SMMEs) has become increasingly important as SMMEs businesses play an important role in encouraging sustainable energy solutions. This study aims to understand the barriers that SMMEs face in securing funding for renewable energy projects, despite their potential contributions to the sector. Existing literature highlights various challenges, including limited access to capital, skills shortages, and complex regulatory frameworks, yet it often overlooks the nuanced experiences of SMMEs. To address this gap, a qualitative, exploratory research approach was employed, involving 12 semi-structured interviews with SMME representatives, financial institutions, and industry experts. The findings reveal that positive outcomes for SMMEs in the renewable energy sector are achievable when financial products are tailored to their needs and when there is strong collaboration among stakeholders. Additionally, SMMEs that possess innovative capabilities, and a clear understanding of market demands are better positioned to navigate the challenges they face The research contributes to the existing body of knowledge on renewable energy finance in providing insights into the factors that enable SMMEs to overcome barriers and succeed in the sector, underlining the importance of project finance together with supportive models, partnerships to enable sustainable energy development.