AFD, Eskom sign R6bn financing deal

To further support its investment in the extension and reinforcement of its power transmission grid, State-owned Eskom has signed a R6-billion multi-tranche framework agreement with the French Agency for Development (AFD).

“This multi-tranche loan facility will contribute towards Eskom plans to strengthen and refurbish the transmission infrastructure while diversifying our funding structures,” said Eskom CFO Anoj Singh.

AFD’s funding will focus on transmission lines and substations that support grid strengthening in areas where the development of future renewable-energy sources is envisaged, as well as supporting the facilitation of cross-border transmission projects.

AFD CEO Rémy Rioux highlighted that the funding reaffirmed the fund’s willingness to be a key financial partner of the utility. “Since the beginning of our engagement with Eskom, almost ten years ago, we have made the choice to focus our support on targeted areas where we can provide value,” he noted.

This funding represents the first multi-tranche facility AFD has approved for the African continent. This new instrument opens a three-year window during which the funding is made available to Eskom to finance projects compliant with eligibility criteria.

This includes Eskom’s transmission development plan, contributing to the evacuation of renewable energy – existing or future – and facilitating the development of cross-border transmission networks.

“We appreciate AFD’s long-standing commitment and support and are pleased that we can continue the valuable partnership with this organisation whose mission is to improve and support Africa’s energy development goals and mobilise resources for the continent’s economic and social development,” said Eskom interim CEO Matshela Koko.