Investec commits debt of $813m for South African renewable projects

South Africa has secured a credit facility of SAR8bn ($813m) from Investec Bank, specialist banking group based in the UK, to financially aid in expanding its renewable energy projects in the country.

The government is expected to use the funds for the construction of plants under renewable energy independent power producer procurement programme (REIPPPP).

South Africa has outlined a renewable programme to add 3,725MW of renewable-energy capacity by the end of 2016 through five tenders, in a bid to reduce country’s dependency on coal power.

Investec project and infrastructure finance member Robert Gecelter said the funds would be used to finance the projects in the country’s third renewables bidding round.

A large part of facility is likely to be invested for concentrated and PV solar plants, along with wind projects, revealed Gecelter.

The funding bids for third round are expected to close by 19 August, while the next batch of preferred projects is expected to be released on 29 October and will be financially closed in 2014.

In its earlier two rounds, the government had allotted 47 renewable projects, accounting for a total of 2,460MW of clean energy.

The UK banker has until now invested a total of SAR20bn ($2.04bn) in the country’s renewable efforts.

Investec project and infrastructure finance head Fazel Moosa said the banking institute would continue extending financial aid in country’s impressive renewable initiative, keeping in view the unprecedented debt and equity financing requirements of the renewable programme.

The bank, meanwhile, is seeking investment opportunities to finance projects in Africa states including in Ghana, Kenya and Mozambique.