New Green Energy Efficiency Fund for South Africa's Industries

SOUTH Africa’s state-owned Industrial Development Corporation (IDC) has launched a R500-million ($62.6 million) fund, for energy efficiency and ‘self-use’ renewable energy projects in energy intensive industries.

The fund, “Green Energy Efficiency Fund” (GEEF), is backed by the German development bank KfW, which has extended a €48-million long-term loan to the IDC. During the launch Geoffrey Qhena, Chief Executive Officer, said the aim of the fund was to encourage and promote investments in both energy efficiency and renewables in South Africa.

Qhena added: "We want to provide increased access to energy efficiency and renewable energy financing across all industry sectors. Setting up this fund with KfW is crucial for the country and a key addition to our portfolio of ring-fenced funds directed at a specific goal.”

GEEF will focus on the private sector in South Africa, providing loans from R1 million to R50 million with a concessionary rate. GEEF also allows loan repayments to be made for up to 15 years, dependent on the energy efficiency or renewable energy technology being funded.

Head of Green Industries SBU, Rentia van Tonder, explained: "Funding is available to companies who plan to implement financially viable projects in South Africa. In other words, projects that will provide significant energy savings and/or emissions reductions, or will offset grid-connected electricity through renewable energy generation for self-use.

"Financing of projects is based on global climate mitigation principles combined with specific IDC funding criteria, which will form the basis on which funding can be accessed."

For South African industry, GEEF will lead to lower energy costs and improved profitability leading South Africa's transition towards a low carbon economy, and leading to long-term competitiveness and job creation.

Picture of South Africa Sunrise in Cape Town by Dorena-Wm reproduced under CCL.

Thursday 20th October 2011

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