In a landmark decision, the African Development Bank (AfDB) will extend to South Africa a financial package totaling USD 365 million in order to help the country green its energy sector.
The financial package includes a loan of USD 265 million approved by the AfDB’s Board of Directors on 30 May 2011, as well as a USD 100 million concessional loan from the Clean Technology Fund. The financial package will support South Africa’s national electricity utility, Eskom, in implementing a USD 1.3 billion renewable energy project introducing concentrated solar power to sub-Saharan Africa and the first utility-scale wind power plant to South Africa.
Not only is the AfDB providing financing, but it is also transferring critical knowledge of how to design and manage wind and solar projects to South African experts. Through funding and training, the AfDB is helping South Africa take a major step towards a strong economy fueled by cleaner energy.
The loan will help Eskom fund two power projects: a 100MW concentrated solar power plant at Upington and the 100MW Sere wind farm near Koekenaap in the Western Cape.. These projects respond directly to South Africa’s need for more energy and to diversity its energy mix, gradually increasing the weight of clean energy to 42 percent by 2030 as anticipated in South Africa’s Integrated Resource Plan released earlier this year.