CrossBoundary Energy Access Secures $25 Million to Build Solar-Powered Mini-Grids in Africa

CrossBoundary Energy Access (CBEA), Africa’s first project financing facility for mini-grids, has announced $25 million in new investment commitments from ARCH Emerging Markets Partners Limited, Bank of America, and the Microsoft Climate Innovation Fund.

This investment will leverage an additional $25 million in senior debt to invest $50 million in CBEA’s pipeline of solar-powered mini-grids in the near future.

Gabriel Davies, Managing Director and Head of Energy Access at CrossBoundary, says, “CrossBoundary Energy Access has grown up with the sector and this fundraising is a testament to the work of the developers, governments, and donors over the last few years. Confidence from ARCH, Bank of America, and Microsoft, reflects the growing maturity of both the mini-grid sector, and its ability to attract institutional capital. Our investors believe the mini-grid sector is ready to scale and that 2022 will mark an inflection point in its growth. Work is still needed on every aspect of mini-grids including regulation, business model, and subsidy programs. But we’re excited by the step-change in scale and pace that we’re seeing from developers, investors, regulators, and donors, and we’re encouraged by the amount of capital the sector is prepared to absorb in the next 24 months.”

Over the next two years, CBEA will invest $150 million to provide sustainable energy to one million people throughout Africa. The mini-grids combine solar and batteries to deliver grid-quality power to homes and businesses 24 hours a day, seven days a week. Individual local residential and small business subscribers will be able to get renewable electricity for the first time as a result of this project. These solar-powered mini-grids will help close the gap by supplying clean electricity to rural areas of Africa that are now without it.

According to the International Energy Agency, more than 600 million people in Africa lack access to electricity. Economic growth, productive investment, job creation, and poverty alleviation are all slowed as a result of this. Solar mini-grids are a solution to this problem, allowing those who do not have access to power to realize their full potential.

“This is a critical milestone for CrossBoundary Energy Access in unlocking the private and public financing needed to develop the mini-grid sector,” says Humphrey Wireko, Managing Director of CrossBoundary Energy Access. We’re excited to mobilize this capital to bring the projects in our pipeline to reality, and to provide power to African homes and businesses via these distributed renewable assets.”

When the targeted $150 million is fully deployed, CBEA’s blended finance method will create a new model for funding rural electrification in Africa, bringing renewable electricity to one million people.

“Reaching universal electrification in Africa demands scaling affordable and clean energy solutions,” says Brandon Middaugh, Director of the Microsoft Climate Innovation Fund. The revolutionary approach to mini-grids developed by CrossBoundary Energy Access provides clean energy solutions to the millions of Africans who still lack access to electricity. Microsoft is happy to assist in the scaling of mini-grid solutions that promote climate fairness by bringing clean energy to more businesses and communities.”