Project Description

On December 19, 2019, the Multilateral Investment Guarantee Agency issued guarantees that will support the development, construction, operation, and maintenance of the Golden Valley and Excelsior  wind power plants in the Republic of South Africa. 

The guarantees issued to Okavango Biology Luxembourg S.à.r.l, a wholly-owned subsidiary of the Actis Energy 4 LP Fund (AE4) (a private equity fund controlled by Actis of the United Kingdom), and totaling US$45.6 million, will cover 90 percent of the equity and quasi-equity/shareholder loan investments in the Project against the risks of Breach of Contract, Expropriation, Transfer Restriction & Currency Inconvertibility, and War & Civil Disturbance for a period of up to 15 years.^[1]

The Project consists of two wind energy generating facilities with combined total installed capacity of 156 megawatts (MW) located in the Eastern Cape (Golden Valley) and Western Cape (Excelsior) Provinces of  South Africa.  Golden Valley is located in the Blue Crane Route Municipality in Eastern Cape near the towns of Cookhouse and Bedford. The Cookhouse area has been defined as one of the Renewable Energy Development Zones in South Africa. Golden Valley will be connected to the grid via a 7 kilometres transmission line. Excelsior is located approximately 30 kilometres southwest of Swellendam in the Overberg region of Western Cape and is connected to the grid via a 13 kilometre transmission line.  The Project was awarded through Round 4 of the South African Renewable Energy Independent Power Producers Procurement Program ( REIPPP). Once operational, the electricity generated from the plants will be sold to Eskom Holdings SOC Ltd, the state-owned public utility in South Africa, under 20-year Power Purchase Agreements (PPAs).

Environmental Categorization

 The project is a category A under MIGA’s Policy on Environmental and Social Sustainability.  Click here  to view the Environmental and Social Review Summary for the Project.

Development Impact

 Renewable independent power producers have grown rapidly in the past five years. Although South Africa remains heavily dependent on coal, the Government of South Africa aims to achieve over 20 GW of renewable capacity by 2030.

Supporting the development of these solar power plants fits in with the Government of South Africa’s renewable energy plan of developing clean, renewable and low-cost electricity in the country. The Project is expected to (i) support the diversification of South Africa’s energy mix, (ii) contribute to increased generation capacity, (iii) reduce carbon omissions by producing green, emission-free electricity (iv) create employment opportunities during construction, and (v) contribute to local community development through financial benefits generated by the Project.

MIGA’s support for this Project is aligned with the Agency’s strategic priority of supporting investments with positive climate change impact.