SA utility Eskom secures $1.1bn from AfDB to fund capacity expansion plan

By bne IntelliNews December 22, 2015

South Africa’s ailing state-owned power utility Eskom has secured a total of $1.1bn funding from the African Development Bank (AfDB) for its crucial capacity expansion programme.

AfDB’s board of directors has approved a $375mn senior corporate loan and a corresponding syndicated loan for up to $750mn to Eskom, which has been struggling to raise funds for its ambitious capacity expansion programme, while also failing to meet current electricity demand and thus contributing to the slowdown in the economy.

Eskom’s capacity expansion plan for the 5-year period to 2020 envisages maintenance and upgrade of nearly 8,000MW of installed capacity and adding of 10,986MW new capacity, including a 1,332MW renewable energy peaking station. It targets also an expansion of Eskom’s transmission network by 9,756km. The plan will not only address the country’s power shortages but also restore South Africa’s role as electricity exporter, AfDB said.

In 2009, Eskom received a €1.86bn loan from AfDB to finance its 4,800MW coal-fired Medupi power station. The first 800MW unit of the long delayed project was launched at end-August.

Eskom, which supplies some 95% of South Africa’s electricity, operates and maintains 42,790MW of generating capacity, mainly at coal-fired plants.

Related Articles

PetroSA, Rosgeo sign $400mn oil and gas exploration agreement for South Africa

South Africa's national oil company PetroSA and Rosgeo, the geological exploration company of the Russian Federation, have signed an agreement on a $400mn oil and gas development project in South ... more

South Africa’s MTN to invest $350mn in Iranian broadband

South Africa’s MTN said it has agreed, on a non-binding and preliminary basis, to invest an initial $350mn into Iranian fixed broadband provider Iranian Net. The investment will give ... more

South Africa receives another downgrade to junk

Fitch Ratings on April 7 downgraded South Africa to junk status following the removal of Pravin Gordhan as finance minister and the enusing political crisis. Fitch's downgrade to 'BB+' ... more

Dismiss