AFRICA'S RESPONSE TO CLIMATE CHANGE CHALLENGES
Washington DC, 25 September 2011—Eskom and the
African Development Bank (AfDB) today signed two loan agreements for a total
value of USD365 million that will enable the first large-scale implementation
of renewable wind and solar generation in Eskom’s history.
The loans consist of USD265 million from the AfDB’s own resources
and USD100 million from the resources of the Clean Technology Fund, a climate
investment fund that promotes the transfer of low carbon technologies. The
loans are guaranteed by the South African Government, consistent with the
AfDB’s procedures. South Africa’s Minister of Public Enterprises, Malusi
Gigaba, and Minister of Finance, Pravin Gordhan, signed the guarantee
agreements. Approved
by the AfDB board in May, the loans will further Eskom’s commitment to
reduce its carbon footprint. The company hopes to begin construction of its
planned Sere 100 megawatt wind project at Vredendal, in South Africa’s Western
Cape, early next year.
Eskom has enjoyed a long and fruitful relationship with the
African Development Bank. In 2008, the AfDB approved and signed a first loan
with Eskom of USD500 million. In December 2009 the AfDB signed a further EUR
1.86 billion-equivalent loan with Eskom for the Medupi Power Project. These AfDB loans to Eskom have reinforced the extent to which
institutions based on the African continent can provide support, which fosters
regional growth.
Eskom CEO Brian Dames said: “These are exciting times for Eskom.
We are committed to a cleaner energy future and we now have the capability to
implement our large-scale wind and solar generation projects. We appreciate the
roles the African Development Bank and the South African government have played
in making this possible.”
AfDB President Donald Kaberuka, who signed the current loan
agreements on behalf of his institution, said: "The AfDB is committed to
supporting South Africa's long-term plans for moving to a lower carbon growth
path. Leveraging and accelerating the disbursement of concessional climate
Financing is essential to achieve economic viability of some of the clean
technology solutions. This is a priority action area for the AfDB. These
groundbreaking renewable investments by Eskom are quite timely, in the run-up
to climate change meetings (COP17) soon to be held in Durban under South
Africa's presidency.
They show that Africa can make a meaningful contribution to the
global response to climate change, when given the financial incentives to do
so." Finance Minister Pravin Gordhan said: “We are pleased at the
confidence that the AfDB has shown in South Africa and in Eskom, and we thank
the AFDB for its funding. This is an important step in securing funding which
will enable Eskom to contribute to the realisation of South Africa’s commitment
to diversify in its energy mix and reduce its carbon emissions over time.”
Public Enterprises Minister Malusi Gigaba said: “This loan will help to mobilise resources for the development of the Southern African region. It is consistent with the AFDB’s mission to promote economic growth and improve the living conditions of many. It is also true to Eskom’s purpose, which is to provide sustainable electricity solutions to improve the quality of life of the people of South Africa and of the region.” http://www.afdb.org/en/news-and-events/article/afdb-eskom-sign-usd365m-renewable-energy-loans-8385/