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US$350 million power financing agreement

Earlier in 2014 efforts to increase access to power infrastructure in Africa were bolstered by a US$350 million financing agreement between industrial and finance groups GE and Standard Bank. The partnership seeks to provide affordable access to power infrastructure that augments traditional large-scale grid capacity development.

The partnership will target 10 initial countries, consisting of South Africa, Nigeria, Angola, Tanzania, Ghana, Kenya, Mozambique, Uganda, Ethiopia and South Sudan. The agreement will allow independent power producers (IPPs) and non-recourse infrastructure projects, industrials and manufacturers, natural resource companies, small to medium enterprises, and other potential borrowers to access project finance, equipment finance, trade finance and advisory services.

“This comes at the right time as efforts are underway in South Africa and across the continent to increase access to electricity in order to stimulate economic growth and improve living conditions,’’ Tim Schweikert, president and CEO – GE South Africa says. “Initiatives of this nature are in line with efforts by governments to find solutions to meet the growing demand for alternative fuels.”

The initiative supports South Africa’s National Development Plan, which says that more than 95% of the population should have access to electricity in the next 20 years. The plan aims to develop an energy industry by 2030 that promotes economic growth and development through adequate investment in energy infrastructure. It targets increased social equity through expanded access to energy services and promotes environmental sustainability through efforts to reduce pollution and mitigate the effects of climate change.

GE’s collaboration with Standard Bank is in line with the country-to-company agreements that GE has signed with a number of African governments aimed at generating incremental power and increasing access.

The collaboration will help energise the sector, Sola David-Borha, CEO of Stanbic IBTC Holdings, a member of the Standard Bank Group in Nigeria, says. Financing will also be available for off-grid solutions that rely on fuels such as biomass and biogas across sub-Saharan Africa through the initiative, she says.

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