The New Development Bank (NDB) and South African utility Eskom have signed off on a loan agreement for renewable energy integration and a transmission augmentation project. As part of the deal, the NDB will provide a loan with sovereign guarantee to Eskom for a total of US$180 million.
The deal was signed by by Xian Zhu, NDB vice president and COO, and Calib Cassim, CFO of Eskom, during the 4th Annual Meeting of the New Development Bank in Cape Town, South Africa.
The NDB’s Project Finance Facility (PFF) will be used to support the development of grid connection infrastructure, which is vital for the development of renewable energy projects. The PFF will also help spur renewable energy development and cut down South Africa’s reliance on fossil fuels. The project will also integrate a total of 670MW of renewable energy into the Eskom’s grid.
Zhu said: “We are happy to support this important project that will contribute to the development of grid connection infrastructure in South Africa and support the shift to a more sustainable energy path in the country. The project is coherent with the Bank’s focus on projects that incorporate sustainability from their inception. Moreover, we believe that supporting South Africa’s energy sector is fully in line with the Bank’s mandate and our role as a reliable development partner.”
Cassim added: “The successful conclusion of this inaugural transaction with NDB will significantly contribute towards driving Eskom’s goals to reduce South Africa’s CO2 emissions. Eskom welcomes the support from NDB and we look forward to fostering a valuable partnership with this organization whose mission is to enhance infrastructure for sustainable development in its member countries.”