A warranty operation orchestrated by the World Bank targets the expansion of energy solutions distributed on nearly twenty African markets, involving a portfolio of projects carried out by Crossboundary Energy and a financial collaboration with Standard Bank South Africa.
The Multilateral Investment Guarantee Agency (MIGA),an entity of the World Bank Group,has signed an agreement for guarantees an amount of $495 million with Crossboundary Energy Holdings. The operation relates to the risk of non-convertibility of currencies and transfer restrictions, and is part of a strategy to deploy energy solutions across the African continent.
A Portfolio Mechanism to Speed Up Deployments
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The system implemented by MIGA adopts a structure based on a portfolio, designed to rationalize the issue of guarantees over one hundred projects distributed in nearly twenty African countries. Among these markets are eleven countries under the International Development Association (IDA), and also four states considered fragile or in conflict.The portfolio architecture allows Crossboundary Energy to quickly extend its operations and mobilize funding from various partners.
The MIGA guarantee, the duration of which can go up to fifteen years, aims to strengthen the financial viability of projects in environments where the risks of exchange and transfer of funds constitute major obstacles. The retained assembly is based on a balanced distribution between pilot and larger-scale operations projects, making it possible to adjust the coverage according to the evolution of local needs.
Financial Arrangements and Regional Partnerships
Along with the implementation of the warranty, Crossboundary Energy announced the closure of a subordinate loan of $60 million, in collaboration with Standard Bank South Africa. This funding is intended to support the construction of a solar power plant of 223 megawatts-key (MWC) and a storage capacity of 526 megawatt hours (MWH) for the Kamoa-Kakula mining site, in the Democratic Republic of Congo. This loan completes senior funding of $141 million granted by Standard Bank in 2024 as part of the regional expansion of Crossboundary operations.
The projects covered by the guarantee incorporate a diversity of african markets, taking into account the constraints of access to financing and regulatory specificities. The structuring of guarantees makes it possible to respond to the volatility of exchange markets while providing investors with increased visibility on the security of their financial flows.
Sectoral Issues and Evolution of Energy Models
According to the World Bank, around 75% of African industrial companies are exposed to recurrent interruptions of power supply, with an average impact estimated between 5% and 8% of annual turnover.The emergence of distributed energy solutions carried by Crossboundary Energy meets an increasing need for alternatives to the traditional thermal model,notably in industrial and mining areas.
The collaboration between MIGA, Crossboundary Energy and local financial partners is part of a context of multiplication of partners.
This article provides general facts and does not constitute financial or legal advice. Consult with qualified professionals for personalized guidance.
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