South Africa Loan Arrangement for Energy Efficiency and Renewables

SOUTH African bank ABSA has made an agreement with the French Development Agency (AFD) to offer loans for clean energy and energy-efficiency projects.

The loan, of €40m, comes at a time as South Africa is about to see an explosion of renewable energy projects on the back of the government's independent power producer procurement programme, and it should seed other financial institutions to benefit from electricity users' deployment of energy-efficient technologies.

South African utility, Eskom and the South African government are both encouraging energy efficiency as their national electricity grid is under capacity.

Commerce and industry need to upgrade their technology as far as enery efficiency is concerned.

Absa revealed that in the last 12 months their commercial arm, Absa Capital, have provided R8,3bn ($1.8bn) worth of credit for energy efficiency and renewable energy projects.

Absa's head of business markets, Marcel de Klerk, said the bank had set up the loan facility to promote energy-efficiency investments, with a minimum value of R10m (£1.31m) and a maximum of R100m ($13.07m) in the local market.

The new funding will focus in part on projects involving retrofitting of existing installations, including energy-efficiency management systems.

Picture of South Africa Cape Town by Derek Keats reproduced under CCL.

Friday 16th March 2012

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