IFC Leads Financing in Key Projects in South Africa’s Renewable Energy Push

IFC has become a leading international funder of South Africa’s drive to reduce dependency on fossil fuels, and a driver of innovative projects including Concentrating Solar Power energy production. 

South Africa has a high level of renewable energy potential and a target of generating 10,000 gigawatt hours through various renewable sources. An independent power producer procurement program was designed to start and stimulate the renewable industry in South Africa and to encourage production capacity of 3,725 megawatts by 2030.

Saleem Karimjee, IFC’s Country Manager for Southern Africa said, “Under South Africa’s Renewable Energy Independent Power Producer Procurement Programme IFC has provided support and focus on technically advanced renewable energy efforts through Concentrating Solar Power  projects. These innovative projects are especially high risk, so IFC’s presence is making a big difference in the success of these projects.”

IFC’s commitment to the project has helped sponsors weather volatile international lending markets and a depreciating local currency, while also offering IFC’s global expertise and experience in renewable energy production.

IFC has supported several renewable energy projects over the past three years developed under South Africa’s REIPPP. In the 2015 fiscal year IFC provided a ZAR 455 million ($37 million) loan to support a new solar thermal electricity power facility in South Africa’s Northern Cape region, building on a series of pioneering renewable energy investments in the country. The 100-megawatt Xina Solar One facility being developed by Abengoa is expected to produce clean energy for more than 95,000 households, create jobs and reduce carbon emissions. 

The Xina facility will be located next to Abengoa’s 100-megawatt Kaxu Solar One, the first solar thermal electricity power plant in commercial operation in South Africa, which was also supported by IFC financing. Those projects, along with the 50-megawatt Khi Solar One facility, another Abengoa facility with IFC support, are set to help South Africa meet its growing energy demands and boost access to sustainable, reliable electricity. 

To meet a goal of ensuring continuous uninterrupted power supply in the country that has recently been plagued by intermittent power outages, 

Under REIPPP, IFC also supported the 134-megawatt Amakhala wind farm in the Eastern Cape and is working on Redstone, a 100-megawatt CSP for which financial close is expected by the end of 2015.

First Published: 9/30/2015