Africa’s largest renewable energy IPP to be sold to Egyptian company

Deal is awaiting regulatory approvals.
Image: Dwayne Senior/Bloomberg

Mainstream Renewable Power together with investment company Actis have announced the sale of Africa’s largest pure-play renewable energy independent power producer (IPP) Lekela Power, to Egyptian company Infinity Group and Africa Finance Corporation (AFC).

News of the sale was revealed in a joint statement by Mainstream and Actis on Monday, months after reports of the potential transfer – estimated to be worth approximately $1 billion – surfaced a few weeks ago.

Although the deal awaits regulatory approval, should authorities give the greenlight, AFC will acquire Lekela’s one gigawatt (GW) fully-operational wind assets, as well as five operational wind farms located in South Africa, one operational wind farm in Egypt and Senegal each, together with other development opportunities Lekela has in Ghana, Senegal and Egypt.

Mainstream and Actis note that the selling-off of the African renewables energy power producer is a necessary step to ensuring the company’s future growth.

“We’re proud to leave Lekela Power strongly positioned for its next phase of growth as an acknowledged sustainability leader, supplying much-needed clean energy to communities across Africa, building on our net zero commitment,” Actis’ partner and head of energy infrastructure Lucy Heintz says.

SA’s power crisis

Forming part of Lekela’s South Africa portfolio is the Khobab Wind Farm located in Loeriesfontein – a small town in the Northern Cape. According to Lekela’s website, the wind farm provides about 564 000 MWh of clean energy to the country’s national grid every year, serving approximately 170 000 South African households.

In the face of South Africa’s energy supply crisis, IPPs like Lekela will play an important role in helping alleviate pressure from struggling state-owned power utility Eskom, which has been vocal about its inability to meet electricity demand in the country, as well as the role that renewables will play in closing that supply gap.

Read:
Energy crisis may spur SA to allow more private power
Eskom identifies additional land for renewable energy projects

In the meantime, South Africans who have been bearing the brunt of the worst bout of power cuts in the last few weeks wait with bated breath for President Cyril Ramaphosa to reveal his grand plan that will hopefully see a nearing end to the country’s energy supply crisis.

Read: We need to act boldly to make load shedding a thing of the past

“There has never been a more critical time to accelerate the global transition to renewable energy, for the health of both our planet and our communities,” Mainstream’s Group chief executive Mary Quaney says.

“Our vision is of a world electrified by renewable energy. Together with our strategic shareholders Aker Horizons and Mitsui, we are well positioned to lead and truly accelerate the transition to renewables in South Africa, across the African continent and in markets globally.”

Read: Nersa to consult on Eskom’s 32.66% tariff bid

AUTHOR PROFILE

COMMENTS   0

You must be signed in and an Insider Gold subscriber to comment.

SUBSCRIBE NOW SIGN IN

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
BTC / USD

Subscribe to our mailing list

* indicates required
Moneyweb newsletters

Instrument Details  

You do not have any portfolios, please create one here.
You do not have an alert portfolio, please create one here.
INSIDER SUBSCRIPTION APP VIDEOS RADIO / LISTEN LIVE SHOP OFFERS WEBINARS NEWSLETTERS TRENDING

Follow us:

Search Articles:
Click a Company: