British International Investment (BII) has announced a
ZAR 125 million ($6.7 million) investment in two 140MW wind farms in the
Northern and Eastern Cape of South Africa. The new funding was trailed at a
business reception in Cape Town hosted by BII and the UK’s development finance
institution (DFI) and impact investor, while they celebrate 75 years of
investing for impact in Africa.
This
is part of a three-project cluster co-developed by H1 Capital and EDF
Renewables. Currently under construction, the two wind farms are expected to
reach completion in 2024 and will provide clean, affordable energy to South
Africa.
BII has invested in at least 150 South African
businesses since 1995, amounting to over $2bn committed to South Africa, and
its portfolio companies have supported over 54,500 jobs a year since 2014. By
the end of 2022, BII’s portfolio value in South Africa had expanded to
approximately $285 million.
South Africa faces a severe energy
crisis, which affects the safety and productivity of everyday life. In
2022, electricity cuts averaged eight hours per day. Outages
experienced by South Africa cost the continent 2- 4% of its gross domestic
product annually, according to the findings of the AfDB study. Supporting a just energy transition, BII’s has
partnered with H1 Holdings, a South African Broad-based Black Economic
Empowerment (BBBEE) renewables investment and development company, and Scatec
to launch three solar and battery storage facilities in Kenhardt under South
Africa’s Risk Mitigation Independent Power Producer Procurement Programme
(RMIPPPP).
Its backing of strategic energy platforms
including Globeleq, Gridworks, ACWA and Redstone demonstrate the UK’s focus on
actively helping economies to reduce emissions and maximise the delivery of
consistent and clean power to South Africa’s cities, villages, townships,
businesses and farms - providing a major boost to productivity and economic
growth.
BII also
hosted a gathering for the African venture capital community, Innovation
for Impact, in Cape Town. The event brought development finance
institutions, investors, fund managers, multinational corporations, venture
capital firms, start-ups and founders together to advance the use of African
venture capital in combating key development challenges and deepening
collaboration across Africa and South Asia.
BII recognises that investing in digital
infrastructure, digitally enabled businesses and tech-led innovation can have a
disproportionately positive effect in addressing key development challenges.
Particularly in South Africa where the digital gap is
significant with broadband in only 10% of households. The DFI has partnered
with South African based Liquid Intelligent Solutions which has 100,000km of
fibre network Africa and Tyme Bank, South Africa’s leading digital bank that
brings crucial banking services to the underbanked populations.
Digitalisation also advances climate
technologies with renewable power, such as solar, wind, and battery energy
storage systems (BESS). Marking its commitment to meaningfully increase energy
access, last year, nearly half of BII’s investments were in climate finance,
valued at £591m.
Mr Nick O’Donohoe, BII CEO, highlighted the
DFI’s special relationship with South Africa and reiterated BII’s ambition to
help solve pressing development challenges in South Africa including reliable
clean energy.
Commenting on BII’s long term commitment to
partner with promising businesses and ambitious entrepreneurs in South Africa, Nick
O’Donohoe, CEO, BII said: “We committed over $5.5
billion to Africa in our last five year strategy period*. BII's strategic objective in South Africa is to
invest its patient, long-term capital to continue to meet the needs of those
whose mission and purpose strive for equality, inclusive economic growth and a
more sustainable future.”
British High Commissioner to South Africa, Antony Phillipson said: “The
work the UK is doing with BII to help grow businesses in South Africa and in
turn create thousands of local jobs, is absolutely fundamental in supporting
our shared ambition with South Africa to build an inclusive, sustainable future
for all.”