The EIB and FirstRand Bank have pooled in €200 million each for renewables in South Africa
Their target audience are the IPPs to help support their clean energy projects
The focus technologies are primarily solar PV and wind energy, and energy-efficiency projects
The European Investment Bank (EIB) has announced a €400 million ($445 million) financing for independent power producers (IPP) in South Africa. This loan is part of a joint initiative between the EIB and local FirstRand Bank Ltd. with both lenders pooling in €200 million ($222 million) each.
The focus investment of this loan facility will go towards renewable energy assets, specifically solar PV and wind energy, along with energy-efficiency projects.
Projects that increase the supply of reliable, affordable, clean and sustainable energy in the country, reducing dependence on fossil fuels will be the ultimate beneficiaries of this facility.
According to the EIB, even though South Africa is one of the world’s top 3 locations for solar PV generation, the investment in this space has not yet matched this potential. The private sector needs to be supported in this endeavor.
“Companies have recognised the business opportunities in moving to clean energy technologies; EIB financing is there to back those investment needs,” said EIB Vice-President Ambroise Fayolle.
The loan will also contribute to job creation during project construction and operation, while increasing energy generation by the private sector, stated the bank. It will also reduce carbon emissions.
South Africa has been promoting large-scale wind and solar PV projects through its flagship Renewable Energy Independent Power Producers Programme (REIPPPP). Under its draft Integrated Resource Plan 2023, the country targets to install 26.03 GW of solar PV and wind energy capacity via the IPP model (see South Africa Approves Integrated Resource Plan 2023).