South African power utility Eskom will sign for a 15 billion rand loan facility with the Development Bank of Southern Africa (DBSA) to fund part of its build programme, the utility said.
Eskom said the funds would be disbursed over a five-year period during which time South Africa anticipates to face a power crunch due to rising power demand in the country.
It said the financing deal would be signed on Thursday. The government has said South Africa, the continent’s largest economy, plans to spend 800 billion rand in the next few years to expand power infrastructure, Reuters reports.
“This loan facility is expected to increase the base-load generating capacity to keep up with growing demand whilst generating a combined total output of approximately 9,000 megawatts,” Eskom said in a statement.
A 2008 power crisis shut down mines and other industries, costing billions of dollars in lost output and officials have warned of rolling blackouts from 2011 to 2016 unless extraordinary measures are taken to generate more power.
Eskom supplies 95 percent of the country’s power and 45 percent of Africa’s electricity, most of which is generated in coal-fired plants built more than two decades ago.