South African utility Eskom Holdings has received a 4 billion rand ($339 million) loan from KfW to help modernise its power grid, Germany’s state-controlled development bank said on Wednesday.
The loan will be used to connect solar and wind power plants to Eskom’s power network and help to secure supply in a country that has been beset with almost daily power outages, KfW said.
“The adjustment of the energy supply is a big step for South Africa away from dependency on coal towards a more sustainable electricity generation,” Norbert Kloppenburg, a management board member at KfW, said in a statement.
Eskom has implemented rolling blackouts over the past year, disrupting business and annoying residents, as its grid struggles to meet growing demand.
Integrating more renewable sources of energy into the grid will also help reduce South Africa’s C02 emissions by up to 5.5 million tonnes per year, KfW said.