17.01.2023 | Case | Nordic SME | Renewable energy | Central African Republic | Somalia | South Sudan
Norway’s Kube Energy builds solar plants and sells clean electricity to international aid organisations and surrounding communities.
A major humanitarian crisis is underway and an international aid organisation has arrived. Its operation needs power, but it is not easy to find in remote and undeveloped areas.
“There might be no grid infrastructure so they have to rely on diesel generators. These are expensive, noisy, difficult to supply and polluting,” explains Mads Uhlin Hansen, CEO of Kube Energy. “Our idea is to build solar plants and sell the electricity to these organisations. In effect, they outsource their electricity generation to us.”
Managing the risks of expansion
Kube Energy is a Norwegian renewable energy company that specialises in providing clean, renewable energy in remote and unstable areas. Nopef has supported its feasibility studies with grants during its international expansion to three countries.
“We contacted Nefco, the fund manager for Nopef, fairly early in our operations when we learned about them at an innovation conference,” Hansen says. “Entering a new market is a big risk for us, with the costs of social impact assessments and meeting local regulations – it all adds up to a significant investment.”
“Kube Energy’s solar model solves a very concrete environmental problem in underserved markets that lack electricity infrastructure and depend on diesel generators for power, and thus it is a great fit for Nopef,” says Mikael Reims, Vice President, Origination at Nefco. “Moreover, Kube Energy’s solar projects involve Nordic technology providers and partners and thus also directly benefit the Nordic region.”
Nopef are easy to work with, their funding scope is broad and their bureaucracy is lightMads Uhlin Hansen, CEO of Kube Energy
An innovative application for proven technology
Kube Energy, established in 2015, is made up of a team with more than 50 years’ experience in humanitarian aid, peace building, development and renewable energy.
“We saw the difficulty organisations like the UN have with energy,” Hansen continues. “Moreover, they have pledged to reduce emissions but are forced to use polluting diesel generators because they don’t have any other option. They don’t have the capital or technical expertise to build solar plants, so we thought: let’s do it for them.”
Kube Energy designs the plants and uses conventional, proven, off-the-shelf equipment that can be easily scaled for the changing needs of both international organisations and local communities.
Working with Nopef and local partners
In 2017, they approached Nopef about a feasibility study on expanding into South Sudan. In 2018, they returned to Nopef to study a move into Somalia. After the completion of the first two projects, Nopef supported Kube Energy for a third time in 2022, helping the company with an expansion into the Central African Republic, for which the feasibility study is currently ongoing.
“Kube Energy works in challenging markets in Sub-Saharan Africa, and Nopef’s participation has helped the company identify risks and plan their projects in a systematic and comprehensive manner,” Reims says. “The company has a scalable business model and, based on the strong results achieved in its first project, Nopef has continued to work with the company on new projects in other markets.”
In South Sudan, Kube Energy has developed 3 MW of solar energy for one UN humanitarian project. In Somalia, Kube is in the process of building two more solar power plants connected to UN peacekeeping with a total capacity of 7 MW. Although their expansion into the Central African Republic is not yet complete, Hansen expects two peacekeeping missions to receive 6-7 MW of solar power from Kube Energy.
The fact that international organisations need new sources of energy emphasises that many of the areas they operate in also need energy. Kube Energy’s solution is modular, with the intention to expand it to provide even more energy, both to local communities and international organisations. While many UN projects last a long time, they are ultimately temporary. When they finally end, the energy generation can pivot to fully serve local communities.
“We have four employees: two in Norway, one in Geneva and one in Nairobi,” Hansen says. “We always involve local partners for our projects; we use local companies to consult on environmental and social impact assessments as well as build and operate the plants.”
Kube Energy’s solar projects involve Nordic technology providers and partners and thus also directly benefit the Nordic regionMikael Reims, Vice President, Origination at Nefco
Thanks to Kube Energy, five major UN projects and surrounding communities now have access to safe, reliable, affordable and clean energy. Hansen stresses the important role that Nopef played in helping them expand.
“Nopef are easy to work with, their funding scope is broad and their bureaucracy is light,” he says. “It is hugely valuable to us not having to spend enormous amounts of resources on applications and reporting.”
In the near future, Kube Energy hopes to finalise the development of the Central African Republic projects and begin construction. It is also looking to expand into Somalia to serve more local communities and international organisations.
“I’m very excited about what we can accomplish next year,” says Hansen.
Financing for green Nordic SMEs – how to apply for funding from Nopef
How to get started with an application for your project:
- Look at Nopef’s financing options and application criteria
- For an initial assessment of your planned internationalisation and its eligibility for financial support from Nopef, please fill in the project proposal form or contact our Nopef team
- Complete and send the application form and required attachments to email@example.com
Text: David J. Cord