AfDB boosts South Africa's Medupi power project with €1.86 billion loan

The African Development Bank (AfDB) has approved a €1.86 billion (US$ 2.81 billion) loan to state-owned utility company, Eskom , to finance South Africa's Medupi power project.

The total cost of the project, which will significantly boost the energy capacity of South Africa and the southern African region, is estimated at €11.19 billion.

It will be financed with 53% equity and 47% by loans, with the World Bank and the export credit agencies as co-lenders with AfDB.

The 4800 MW Medupi, which means "rain that soaks parched lands", is located in Lephalale, Limpopo Province, is expected to be commissioned by February 2012.

Besides Medupi, a dry-cooled coal fired power station, Eskom is working on a number of renewable energy programmes including a pilot wind farm in the Western Cape, a 100 MW heliostat pre-feasibility tower-type solar power plant, and a 100 MW wind farm feasibility study.

Eskom is also pursuing a demand-side energy conservation program aimed at saving 4225 MW of electricity.