European Investment Bank finances renewable energy in South Africa
The European Investment Bank (EIB) and the Development Bank of Southern Africa (DBSA) have formally agreed on a financing programme to unlock €400 million for private sector renewable energy investment across South Africa.
The €400 million initiative (ZAR7.2 billion) will be backed by €200 million from the EIB and provide financing for a range of new renewable energy projects across South Africa.
The scheme will help to increase clean energy power generation and contribute to DBSA’s Embedded Generation Investment Programme (EGIP). The new initiative is expected to generate an additional 1,200 MW of generating capacity.
DBSA CEO Patrick Dlamini commented, “The Development Bank of Southern Africa has a clear goal to increase investment in renewable energy and improve energy security, not only in South Africa but across the African continent. South Africa, like many African countries, is already suffering the effects of climate change. This new investment from the EIB in our Embedded Generation Investment Programme is an important contribution to South Africa’s resilient and sustainable growth.”
EIB vice-president Ambroise Fayolle added, “As the EU Climate Bank, the EIB is committed to supporting South Africa’s efforts to decarbonise and today’s agreement of the largest ever EIB investment in South Africa follows past support for renewable energy and climate adaptation projects across the country. EIB Global is pleased to build on three decades of partnership with DBSA to boost renewable energy generation which will contribute to energy security and a just transition in South Africa. The EIB is stepping up our efforts to support green energy projects globally, with a special focus on Africa and economies dependent on carbon intensive activities that are vulnerable to the impacts of climate change.”
The financing will be available for renewable energy projects – solar photovoltaic and onshore wind energy generation – and potentially also energy efficiency projects promoted by the private sector in South Africa. These projects are expected to provide a reliable source of energy for South Africans at a lower cost than fossil fuel alternatives. The EIB facility complements the Just Energy Transition Partnership with South Africa, which focuses on support to the public sector.