Project financing facility CrossBoundary Energy Access (CBEA) has raised US$25 million to finance solar powered mini-grids in Africa.
The company secured funding commitments from ARCH Emerging Markets Partners, Bank of America and the Microsoft Climate Innovation Fund, with an additional US$25 million in senior debt to develop its near-term solar mini-grid portfolio.
Mini-grids will be co-located with solar and battery storage solutions to provide ‘round the clock’ power to the residential and commercial market.
The initiative will allow CBEA to bridge the gap for rural areas of Africa who currently had no access to electricity, with project financing being essential to unlock long-term capital to finance the mini-grid sector, CBEA said.
Over the next two years, CBEA said it will deploy US$150 million to bring clean energy to one million people in Africa.
Humphrey Wireko, managing director at CrossBoundary Energy Access, said: “This is a crucial step for CrossBoundary Energy Access towards unlocking the private and public capital needed to scale the mini-grid sector. We look forward to mobilizing this investment to bring the projects in our pipeline to life, and providing power to African homes and businesses through these distributed renewable assets.”
Investment in the off-grid solar segment attracted a record US$450 million in 2021, after years of topping around US$300 million, but was still negatively affected by the pandemic and had difficulties in raising finance, according to a report from the Global Off-grid Lighting Association (GOGLA).