The European Investment Bank (EIB) and the Development Bank of South Africa (DBSA) have launched a financing programme to support €400 million (US$413 million) worth of renewables investment in South Africa.
Announced at the United Nations COP27 conference in Egypt, the scheme will be backed by €200 million (US$206 million) in EIB money and is expected to add 1.2GW of renewable capacity to the country’s energy framework.
It falls under the DBSA’s Embedded Generation Investment Programme, announced in 2017, which aims to fund and expand the rollout of solar PV and wind generation across South Africa, specifically by independent power producers.
DBSA CEO, Patrick Dlamini said: “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.”
The two banks first worked together in 1995, and have since collaborated on 11 projects. This marks the EIB’s largest ever investment 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,” said EIB vice president Ambroise Fayolle.
South Africa has seen a number of investment projects of late; the World Bank committed US$497 million to repurposing a coal plant to install 150MW of solar PV, and last week Chinese-owned Talesun opened a 325MW PV manufacturing plant in the country.
The EIB said its facility complements the Just Energy Transition Partnership with South Africa, which focuses on public sector developments to ensure that socioeconomic needs are met in communities most vulnerable to the effects of the energy transition.
This news follows an August announcement by the South African government, introducing a slew of policy changes to accelerate the deployment of renewable energy across the country and stabilize its grid as quickly as possible to mitigate the country’s recent blackouts.