European, Southern African development banks to lend extra $220m to clean energy projects

The European Investment Bank (EIB) and Development Bank of Southern Africa (DBSA) have committed to jointly lending an additional €200m ($220.16m) to renewable energy projects in South Africa.

Source: Reuters.

The concessional financing is on top of the €400m the EIB and DBSA pledged at the Cop27 climate summit in 2022 to support independent power projects in Africa's most industrialised economy.

South Africa's new energy minister vowed in July to accelerate the shift to renewable energy from coal, after halting progress under a predecessor who opposed swift decarbonisation.

The country is among the world's top greenhouse gas emitters because it relies heavily on coal for power generation, but it also has abundant renewable energy potential.

The EIB and DBSA will each commit an additional €100m in loans to support small- and medium-sized renewable energy projects, particularly solar and onshore wind, the two banks said in a statement.

Supported projects are expected to add 384 megawatts of new renewable energy capacity, they said.