The most expensive kilowatt-hour in the world isn't the one you pay for at home. It's the one a telecom tower operator in rural Africa buys from a diesel generator, a cost that can run to $0.80 per kWh when you factor in fuel, transport, maintenance, and theft. For Varun Giridhar, founder of London-based Circular Energy, that number is the entire business case. His company is taking a $12 million seed round [PitchBook, 2026] and aiming it at a single, stubborn problem: replacing the diesel hum on the edge of the grid with a battery you pay for by the month.
A bet on opex over diesel
Circular Energy's pitch is straightforward. It finances, procures, installs, and maintains lithium-ion battery systems for commercial and industrial customers, primarily in telecommunications across Africa and Asia [Perplexity Sonar Pro Brief]. The customer pays a fixed monthly service fee for 7 to 15 years, with no upfront capital expenditure [thecircularenergy.com]. The company handles everything from import logistics to remote performance monitoring and eventual refurbishment or repurposing of the battery assets. In essence, it swaps a high, volatile operational cost (diesel) for a lower, predictable one (a battery lease), while taking the operational headache off the customer's plate. The unit economics hinge on the spread between that monthly fee and the customer's current diesel spend, minus Circular's cost of capital, hardware, and a global operations team.
The circular hook
The 'circular' part of the name isn't just marketing. A significant chunk of the company's proposed margin and environmental claim rests on what happens to a battery after its primary service life powering a tower. The model includes taking back batteries, assessing their health, and then finding a second or third life,perhaps in a less demanding commercial application or for residential solar storage [Perplexity Sonar Pro Brief]. This lifecycle management is meant to squeeze more value from the raw materials and improve the overall financial model. It's a necessary feature for a hardware-heavy business targeting markets where total cost of ownership is scrutinized down to the last penny.
An unproven scale engine
For all the clarity of the model, the path from a single pilot to a scaled portfolio is mined with operational risks. The company is entering a field where local champions and global giants already operate, albeit with different models.
- Logistical complexity. Procuring, importing, and commissioning container-sized battery systems across multiple African jurisdictions is a regulatory and customs marathon, not a sprint. Each country presents its own tariff and standards puzzle.
- Performance risk. Batteries degrade, especially in high-temperature environments. Circular Energy's promise of predictable output and cost savings depends entirely on its ability to manage that degradation remotely and proactively.
- Capital intensity. The $12 million seed is a substantial starting war chest, but financing a growing portfolio of leased assets will require increasingly large debt facilities or further equity rounds. The cost of that capital will directly pressure the monthly fee spread that makes the model work.
The competitive landscape isn't idle. Large energy service companies (ESCOs) and regional solar home system providers are expanding into C&I storage. The incumbent Circular Energy must beat, however, isn't another battery startup. It's the diesel generator truck that already sits at the base of thousands of towers,a technology that is deeply understood, readily available, and, for all its faults, mechanically simple.
A back-of-the-envelope calculation shows the hill to climb. Assume a single telecom tower site consumes 10 MWh per month on diesel at $0.80/kWh, a monthly cost of $8,000. If Circular can offer a battery service for $5,000 per month, the savings are clear. But to deploy 100 such sites, the company would need to finance roughly $5-7 million in hardware alone (estimated), not counting operations. Their $12 million seed gives them room to prove the model works at scale before the next, much larger financing round becomes imperative.
Sources
- [PitchBook, 2026] Circular Energy funding profile | https://pitchbook.com/profiles/company/57428-56
- [Perplexity Sonar Pro Brief] Summary of Circular Energy's business model and target markets
- [thecircularenergy.com] Company website describing service offering and terms | https://thecircularenergy.com/
- [LinkedIn, retrieved 2026] Varun Giridhar profile | https://www.linkedin.com/in/varun-giridhar/