Grace Ashiru
Denmark’s Impact Fund Denmark has committed USD 40 million to CrossBoundary Energy, injecting fresh capital to expand its on-site solar and battery systems for commercial and industrial (C&I) clients across Africa.
The investment will support the development, construction, and operation of distributed renewable energy projects aimed at replacing costly diesel generators and delivering stable power to businesses unable to rely on national grids. CrossBoundary sells electricity via long-term power purchase agreements (PPAs) and lease contracts, often at rates below grid tariffs and the total cost of running diesel generators. Its zero-capex model removes upfront investment barriers, allowing clients access to clean, predictable power without purchasing hardware.
CrossBoundary currently operates approximately 30 projects across eight African countries, serving multinational clients such as Unilever and Guinness. Recent initiatives include powering the telecom towers underpinning Sierra Leone’s first 5G network, and co-developing Madagascar’s first utility-scale wind farm alongside a 14 MWp solar installation for Rio Tinto’s ilmenite mine.
Impact Fund Denmark positioned the funding as a dual-purpose investment: cutting emissions while supporting business continuity in regions prone to power outages. CrossBoundary leadership highlighted that removing upfront costs allows firms to focus on operations while benefiting from fixed energy pricing, performance guarantees, and hassle-free maintenance.
Africa’s Distributed Solar: A Sector on the Rise
- C&I Solar Growth: Sub-Saharan Africa’s C&I solar capacity was under 300 MW in 2019, but has grown significantly by the end of 2024 (
- Continental Solar Surge: In 2024, Africa added 2.4 GW of new solar capacity, with expectations to install 23 GW more by 2028, more than doubling current capacity
- Operational Solar Scale: The continent now boasts 20 GW of operational solar capacity, with an additional 10 GW in the development pipeline
- Cost Competitiveness: In markets like Kenya, Nigeria, and Ghana, on-site C&I solar power is priced at USD 0.10–0.14/kWh, undercutting grid tariffs—with projections falling to USD 0.05/kWh by 2030Â
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Market Shifts Driving Distributed Energy Investment
This deal signals two key market-wide shifts in Africa’s renewable energy landscape:
- Institutional Adoption of Distributed Energy
Development finance institutions and sovereign-backed funds are now channelling larger, structured capital into distributed C&I energy projects—not just utility-scale solutions. - Private Sector Embracing On-Site Generation
Companies increasingly value long-term agreements for on-site systems as fuel costs and outage risks materially affect their operations.
Challenges on the Horizon
Despite growing momentum, barriers remain. Viable project economics depend on stable policy environments, enforceable contracts, and strong O&M standards. Currency risk is another critical issue—revenues are often in local currencies while equipment and financing are dollar-denominated.
Competition is rising, with more local and international developers targeting this space. That said, CrossBoundary’s model and the Impact Fund’s backing may accelerate both market confidence and the energy-as-a-service trend.
This USD 40 million investment is poised to expand CrossBoundary Energy’s project pipeline and help entrench the energy-as-a-service model within Africa’s commercial sector. To unlock greater scale, the market will need more blended finance vehicles, local bank participation, and standardization of PPA structures and asset servicing practices.
With solar capacity surging across the continent, cost parity with combustion sources, and growing institutional and private commitment, the case for distributed renewables powering Africa’s businesses has never been stronger
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