Norway’s Norfund and KLP has made a $40 million equity investment in CrossBoundary Energy, to support renewable energy projects in Africa.
CrossBoundary focuses on commercial and industrial investments.
KLP and Norfund made the investment together, via KLP Norfund Investments. KLP is Norway’s largest pension company. Norfund manages the joint fund.
CrossBoundary president CIO Pieter Joubert said the Norwegian investment was “aligned with our belief that the business sector across Africa should be able to benefit from cheaper, cleaner and more reliable power”. The company aims to have a portfolio of more than $300mn within five years, he said.
It currently has $188mn of projects, for 30 companies in 14 countries. This has 150 MWp of solar photovoltaic (PV), 50 MWh of battery storage and 12 MW of wind assets.
Norfund investment manager Kristoffer Valvik said “distributed renewables are playing a critical role in driving towards the clean and sustainable growth of the commercial and industrial sector across Africa”.
Renewable energy, plus batteries, provide businesses with “immediate cost savings whilst significantly reducing their emissions, and creating employment in the renewable energy sector”.
ARCH Emerging Markets invested a similar sum, via its Africa Renewable Power Fund (ARPF), in CrossBoundary in 2020.
ARCH ARPF managing director William Barry welcomed CrossBoundary’s progress since the investment.
The company’s portfolio has grown “ten-fold over the last two years. CrossBoundary Energy has established itself as a pioneer and clear market leader in the commercial and industrial renewable energy sector across Africa, and we look forward to supporting the next phase of growth enabled by Norfund and KLP’s investment.”
Kenya’s Persistent Energy Capital also announced this week that it had received a $10mn equity investment. Kyuden International Corp. and FSD Africa Investments provided the backing, in a Series C round.
Kyuden is the overseas arm of Japan’s Kyushu Electric Power. FSD is the investment arm of the UK’s Foreign, Commonwealth & Development Office (FCDO) development arm, FSD Africa.
Persistent managing partner Tobias Ruckstuhl said the two new investors “are committed to our entrepreneurial climate venture building model. By leveraging these powerful partnerships, we will be able to accelerate our most pioneering venture building investments, driving the transition to clean energy, promoting e-mobility and finding innovative business models and technological developments across the continent.”
Persistent invested in Daystar Power, another C&I provider, in 2019.