Norwegian development finance institution Norfund and the Macquarie-managed UK Climate Investments (UKCI) have agreed to invest in a joint venture to fund its 40% participation in the development of a 700MW onshore wind portfolio in South Africa.
The joint venture belongs to two local companies, H1 Holdings and Pele Green Energy.
Norfund and UKCI will make the investment along with Enel Green Power (EGP), which will have a 60% stake in the renewable portfolio.
The deal is valued at around $100m and thought to be one of South Africa’s biggest renewable energy equity deals.
UKCI managing director Richard Abel said: “UK Climate Investments has operated in the region for over three years now and has committed more than £67m ($90.1m) across several exciting renewable energy projects.
“This partnership and investment is another sign of the growing maturity of the market and an indication that the future of green finance in sub-Saharan Africa will be bright.”
The investment is intended to support South Africa’s transition towards a low-carbon economy.
It is also part of the UK Government’s commitment to helping South Africa’s post-Covid-19 recovery.
Norfund Clean Energy vice-president Bjørnar Baugerud said: “Norfund believes that providing increased access to affordable renewable energy is an effective way to contribute to create jobs and improve lives.
“Increasing the share of renewables in the South-African energy mix is also an important contribution to limit the climate crisis.”
H1 Holdings CEO Reyburn Hendricks said: “H1 is proud to play a role in assisting in the portfolio of wind farms to become a reality.
“We look forward to working with our funding partners, UKCI and Norfund, as well as our fellow shareholders, Enel Green Power and Pele Green Energy, in contributing to meeting South Africa’s commitments to a lower-carbon energy system.”
Last October, Scatec Solar agreed to acquire SN Power from Norfund for a $1.17bn consideration.