South Africa’s power utility has secured a US$180 million loan from Brics’ New Development Bank (NDB) to be used to expand its renewable energy efforts, Eskom has said.
The NDB and Eskom signed the loan agreement for Renewable Energy Integration and Transmission Augmentation Project on Monday.
Under the accord the NDB, set up by Brazil, Russia, India, China and South Africa (Brics), will provide a loan with sovereign guarantee to the power utility, Eskom said.
NDB Vice President and Chief Operations Officer Xian Zhu and Eskom’s Chief Financial Officer Calib Cassim penned the deal at the 4th annual meeting of the NDB in Cape Town on Monday.
“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 the NDB and we look forward to fostering a valuable partnership with this organisation, whose mission is to enhance infrastructure for sustainable development in its member countries,” Cassim said.
The bank’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, according to the state-owned power supplier.
The PFF will also support renewable energy development and reduce the country’s reliance on fossil fuels, Eskom said, adding that the project would integrate 670 MW of renewable energy into the power utility’s grid.