African Clean Energy Developments (ACED) and Energy Infrastructure Management Services (EIMS Africa) are thrilled to announce that financial close has been reached, and construction commenced, on the 13.5MW Lower Maguduza Hydro Power Project in Eswatini. The project was sponsored and developed by ACED, with the African Infrastructure Investment Managers (AIIM) managed IDEAS Fund and the Eswatini Public Service Pensions Fund (PSPF) as shareholders, and with strong support from Old Mutual Eswatini.
Working closely together, ACED and EIMS Africa have successfully brought the project to financial close. ACED will continue to provide construction management services, while EIMS Africa will act as both the Operations and Maintenance (O&M) contractor, and the operating phase management services provider to the project. All energy produced by the project will be sold through a bilateral Power Purchase Agreement (PPA) to the Eswatini Electricity Company (EEC).
“We are immensely proud to have achieved financial close and construction commencement on our first hydroelectric project, and our first project in Eswatini, in partnership with our very supportive shareholders, lenders, contractors, the EEC and all of our Eswatini partners and regulators. In addition to energy security for Eswatini, this project will also create jobs and support development locally,” said James Cumming, Chief Executive Officer of ACED.
Standard Bank South Africa acted as the lead arranger, with Standard Bank Eswatini, Standard Bank South Africa and PSPF providing the debt financing to the project. The continuous support of AIIM and Old Mutual Eswatini, along with Eaglestone, Cliffe Dekker Hofmeyr, Pinsent Masons, Fasken, Bastion, AEVO and DNV in their advisory capacities, was instrumental in achieving financial close for the project.
“This deal will unlock critical renewable energy development to support Eswatini’s energy security and access to affordable energy. It also assures the country’s steady journey towards reducing its reliance on traditional forms of energy and pivots it towards cleaner, sustainable sources of energy,” concludes Sherrill Byrne, Executive Vice President for Energy and Infrastructure at Standard Bank.
“We are pleased that this project has reached financial close and construction has commenced. It is a major milestone for the Fund to have concluded the first renewable energy project in Eswatini which aims to put the country on a course to energy self-sufficiency. There are a couple of positive spin-offs for this project which includes job creation, industrialization, and above all maximization of income for the Fund,” said Mr Masotja Vilakati, Chief Executive Officer of the PSPF.
This deal marks the ACED and EIMS Africa teams having brought about 500MW of hydro, wind and solar projects to financial close in the last 24 months, enhancing the consortium’s collective drive to be a leader in renewable energy development and operation in South Africa and across the continent. This is further to the gigawatt of projects they have already developed and operate via the South African Renewable Energy Independent Power Producer Procurement Programme.