Addressing Funding Challenges and Compliance Costs for Entrepreneurs in the Energy Sector

Tumuge Lutic Mosoane sent a message to Kgosientsho Ramokgopa.

To
Kgosientsho Ramokgopa
From
Tumuge Lutic Mosoane
Subject
Addressing Funding Challenges and Compliance Costs for Entrepreneurs in the Energy Sector
Date
Feb. 5, 2025, 11:04 a.m.
Dear Honourable Minister Ramokgopa,

I write to you as both an entrepreneur and a firm believer in the critical role of energy security in driving South Africa’s economic transformation. As the founder of Winsome Africa, a company dedicated to assisting businesses in automating their financial processes and ensuring financial sustainability, I have firsthand experience of the financial and regulatory hurdles that hinder entrepreneurs from expanding and innovating—especially within the energy sector.

South Africa faces an energy crisis that presents both a challenge and an opportunity. While government and private sector investments in renewable energy and alternative power solutions are increasing, small and medium enterprises (SMEs) in the energy space struggle to access funding for expansion and innovation. These businesses—whether in solar power, battery storage, energy efficiency solutions, or infrastructure support—have the potential to make a significant impact on our energy landscape but are often held back by prohibitive funding structures and excessive compliance costs.

Key Challenges Entrepreneurs Face in the Energy Sector
Limited Access to Funding for Expansion and Innovation

Entrepreneurs seeking to enter or scale within the energy sector face high capital requirements but struggle to access funding from traditional banks and government initiatives.
Many financing models favor large, established players while SMEs, which are often more agile and innovative, remain locked out.
The funding approval process for government-backed programs is often slow and bureaucratic, preventing businesses from seizing market opportunities in real time.
High Cost of Compliance

Compliance with NERSA regulations, municipal bylaws, environmental assessments, and licensing requirements creates significant financial strain on energy entrepreneurs.
While regulation is necessary, it often disproportionately affects smaller businesses that lack the legal and financial resources to navigate these processes efficiently.
Many SMEs in energy solutions (such as solar, battery storage, and independent power production) are deterred by excessive red tape, leaving the sector largely dominated by established corporations.
A Call for Entrepreneur-Led Solutions
While government support exists, many initiatives are designed without deep engagement with the very entrepreneurs they seek to assist. The solution lies in involving experienced entrepreneurs in shaping funding models, streamlining compliance frameworks, and developing policies that encourage, rather than stifle, innovation in the energy sector.

I propose that the Department of Electricity, along with the Department of Small Business Development, formally include experienced entrepreneurs in policy design, funding model reviews, and regulatory simplification processes. Entrepreneurs understand the realities of starting and scaling businesses in a way that traditional policy frameworks may not fully capture.

As someone who has built a business from the ground up and assisted countless others in navigating financial challenges, I volunteer to be part of such an initiative. My expertise in finance, accounting, and business automation, coupled with my involvement in entrepreneurship and energy sector solutions, can contribute to crafting practical, implementable solutions that benefit the entire industry.

The Role of Winsome Africa in This Vision
At Winsome Africa, we have worked with entrepreneurs across industries, assisting them in achieving financial sustainability and compliance while remaining innovative. We understand that financial automation and streamlined reporting can ease the burden on businesses. However, private initiatives alone cannot resolve systemic issues—collaboration between government, entrepreneurs, and financial institutions is essential to driving real change.

I urge your office to consider the following:

Revising funding criteria for energy-sector entrepreneurs, ensuring that innovative, small-scale businesses can access capital without excessive administrative delays.
Reducing compliance costs by digitizing, simplifying, and fast-tracking regulatory approvals for SMEs in the energy sector.
Establishing an entrepreneur advisory panel within your department to co-create solutions for financing and regulatory challenges in the energy space.
I welcome the opportunity to engage with you and your team on these proposals and to contribute towards an entrepreneur-driven, innovative energy sector that not only addresses South Africa’s energy crisis but also creates jobs and drives economic transformation.

Thank you for your time and consideration. I look forward to your response and to working towards a more inclusive and enabling environment for energy entrepreneurs in South Africa.

Yours sincerely,

Tumuge Lotic Mosoane
Founder & President, Winsome Africa

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