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Standard Bank Boosts Funding for S. African Clean-Power Projects

Nov. 7 (Bloomberg) -- Standard Bank Group Ltd., Africa’s largest lender, increased funding for wind and solar projects in South Africa and took equity stakes in four clean-power ventures as the country expands its renewable-energy industry.

Standard Bank will underwrite 9.4 billion rand ($1.1 billion) of debt for 11 of the 28 projects approved by the government in the first bidding round, the Johannesburg-based lender said today in an e-mailed statement. In May, the bank said it would provide 8.1 billion rand in funding.

South Africa has embarked on a renewable-energy drive to boost generation capacity after power shortages caused mines and smelters to halt in 2008. The initial 28 projects, set to add 1,416 megawatts, were approved in December last year and the Department of Energy signed agreements with the developers on Nov. 5, opening the way for bank financing deals to be struck.

The projects will require 47 billion rand of fixed investment, and about 57 percent of that will be funded by debt, Standard Bank said. As well as underwriting the debt, it will provide clients with interest and currency hedges, carbon-trading credits and guarantee facilities, it said. The bank didn’t specify which projects it has taken an equity stake in.

“Standard Bank will be ready to disburse funding for most of the projects as soon as all documentation is finalized and hedges are closed,” said Alastair Campbell, the lender’s head of power finance. “We are financing five out of the eight wind projects and six of the 18 solar photovoltaic projects, and so will underwrite about a third of all project debt.”

To contact the reporter on this story: Mike Cohen in Cape Town at mcohen21@bloomberg.net;

To contact the editor responsible for this story: Nasreen Seria at nseria@bloomberg.net

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