UKCI And Norfund Fund JV’s Equity Participation In Wind Farm Portfolio

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Cape Town-based investment firm H1 Holdings, which has inked a joint venture with an independent power producer in South Africa, has received financial backing as it moves ahead with one of the country’s largest renewable energy deals involving onshore wind energy assets.

The joint venture created by H1 Holdings and Pele Green Energy has got financial backing from Macquarie-managed UK Climate Investments (UKCI) and Norfund to fund its 40% equity participation in a 700 MW portfolio of onshore wind farms.

Both partners will invest alongside Enel Green Power in one of South Africa’s largest renewable energy equity deals valued around $100 million, as per a note.

It is not clear if the investment in the JV will take the form of equity or debt capital. An email query to the spokespersons did not elicit any response.

Despite having some of the world’s best renewable energy sources, almost 600 million people in Sub-Saharan Africa live without access to electricity. While this number has been in steady decline over recent years, the Covid-19 pandemic has halted progress and 13 million additional people lacked access to electricity in 2020 compared to the previous year.

In addition to tackling this challenge, the UKCI and Norfund’s investment will aim to accelerate South Africa’s transition to a low-carbon economy.

Richard Abel, managing director at UKCI, said UK Climate Investments has operated in the region for over three years and has committed more than £67 million across several exciting renewable energy projects.

“This partnership and investment is another sign of the growing maturity of the market, and an indication that the future of green finance in sub-Saharan Africa will be bright,” said Abel.

Gqi Raoleka, MD of Pele Green Energy, said: “This investment expands our operational involvement in wind farms across South Africa but of more significance is the offshore direct investment being attracted into the South African economy.”

While H1 Holdings brings its fundraising capabilities to the venture, Pele Green Energy will assume a more operational role across the portfolio. Enel Green Power will retain a 60% ownership interest in the portfolio.
– CapitalQuest

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