China joins $2bn South Africa fund

Standard Bank has signed a 20bn rand ($2.18bn) agreement with the Industrial and Commercial Bank of China (ICBC) to jointly fund renewable energy projects in South Africa.

ICBC is Standard Bank’s single largest shareholder with a 20% stake. Johannesburg-based Standard Bank has already provided financing for a number of wind and solar projects.

Two rounds of renewable energy tenders have been completed so far, and the winners of the third round are due to be announced soon, Standard Bank says.

The bank says the 20bn rand funding agreement will be jointly run by the two partners and used to provide debt financing on a project-by-project basis.

“ICBC is…certainly interested in raising awareness of the South African investment opportunity among Chinese suppliers as potential sources of contracting capability,” says ICBC chairman Jiang Jianqing.

“The objective of this partnership is to facilitate the entry of investors into South Africa.”

Chinese groups that have already established footholds in the country’s renewable energy market include Sinovel in the wind sector and JinkoSolar in PV.

South Africa wants to supplement its energy mix, which is still heavily reliant on aging coal-fired power stations. By 2030, the country aims to lift renewables' share of the country’s energy mix from 1% to 8% of energy output.