The Sustainable Energy Fund for Africa (SEFA) has approved US$990,000 to eThala Management Services, to support the development of a 10-MW Biomass-to-Power plant to be located in Harding, 200 km south of Durban in the KwaZulu Natal Province of South Africa.
The project will enable further diversification of South Africa’s power generation mix away from coal dominance by adding renewable energy generation from biomass. The viability of the project will have a significant demonstration effect with regards to bioEnergy and showcase Corporate Power Purchase Agreements as an anchor for renewable energy generation. It is expected to deliver economic empowerment and boost the socio-economic development of Harding community. The project’s source of biomass is agricultural, forestry and timber processing waste which, coupled with the gasification technology presents significant CO2 emissions reductions benefits.
“With the sponsor being a women-led business, the project is aligned with the Bank’s Affirmative Finance Action for Women in Africa and can have a significant demonstration effect,” says Ousseynou Nakoulima, AfDB’s Renewable Energy and Energy Efficiency Director. The SEFA funding will be instrumental in supporting the development of the project towards financial close by detailed engineering designs, a full environmental and social impact assessment (ESIA), as well as legal and financial/transaction advisory services.
The Project is consistent with the Bank’s 10-Year Strategy on inclusive/green growth through the delivery of energy access; the Bank’s Private Sector Development Strategy (2013-2017) through leveraging of private sector financing, the Energy Sector Policy 2012 and the New Deal on Energy for Africa. It is also aligned with the Bank’s Country Strategy Paper for South Africa, 2013–2017, which emphasizes supporting “pilot testing cutting-edge clean energy and energy efficiency technologies,” in the country.
Launched in 2012, SEFA is a US$95-million multi-donor facility funded by the governments of Denmark, the United Kingdom, the United States and Italy. It supports the sustainable energy agenda in Africa through grants to facilitate the preparation of medium-scale renewable energy generation and energy efficiency projects; equity investments to bridge the financing gap for small- and medium-scale renewable energy generation projects; and support to the public sector to improve the enabling environment for private investments in sustainable energy. SEFA is hosted by the Renewable Energy Department of the AfDB.