Norfund and CDC Group, the UK’s development finance institution, announced a commitment to invest approximately US$39.3mn in H1 Capital, a South-African black-owned and managed renewables investment and development company
The transaction represents a joint vision by the DFIs to mobilise climate finance to Africa and back clean infrastructure projects across the continent. The investment from Norfund and CDC, which will soon be renamed British International Investment (BII), will help to improve access to clean and affordable energy in South Africa. The increase in clean energy supply will provide consistent power to cities, villages, townships, businesses and farms, thereby increasing productivity and encouraging economic growth.
South Africa government has set a target to generate 20GW of new renewable capacity over the next decade to address power shortages and decarbonise the power generation fleet, where 86% of the country’s energy mix is thermal. This investment will support the country’s clean energy goals, as it will enable H1 Capital to fund a pipeline of over 2.4GW of new wind and solar projects, generating approximately 6,400GWh per year. This will contribute to avoiding annual emissions of 6.2mn tons of CO2, and help to accelerate South Africa’s transition to clean energy.
The investment in H1 Capital demonstrates commitment by the UK and Norway to act on pledges made at COP26, scaling climate finance to Africa and deepening collaboration on solutions that will meet the continent’s needs and address the climate emergency.