Standard Bank has successfully closed a R567 million financing agreement to support the development of the 13.5MW Lower Maguduza Hydropower Project in Eswatini. Spearheaded by African Clean Energy Developments (ACED), the initiative is backed by the African Infrastructure Investment Managers (AIIM)-managed IDEAS Fund and the Eswatini Public Service Pensions Fund (PSPF) as key shareholders. ACED will continue to oversee construction, while its affiliate, Energy Infrastructure Management Services (EIMS Africa), will manage the project’s operational and maintenance phases.
Serving as the mandated lead arranger for the transaction, Standard Bank has played a pivotal role in advancing Eswatini’s goal of energy security. The hydropower project aims to harness the country’s natural resources to generate electricity domestically, thereby reducing its reliance on imported power.
In recent years, the Eswatini government has actively pursued energy sector reforms and the expansion of its domestic power generation capacity. These efforts are designed to liberalise the energy market, enhance national energy security, and improve access to reliable and affordable electricity.
Barry Schutzler, Head of Corporate & Investment Banking for Eswatini at Standard Bank, reaffirmed the institution’s commitment to supporting renewable energy projects across Africa.
“As the leading banking partner for the renewables sector in Eswatini, this financing underscores our dedication to driving the just energy transition across the continent we call home. It also highlights our firm resolve to champion the responsible development of renewable energy solutions.” he stated.
Eswatini currently imports around 80% of its electricity, with 65% of its supply sourced from South Africa’s Eskom. The Lower Maguduza project marks one of the country’s first independent power producer (IPP) initiatives to reach financial close. By shifting Eswatini’s energy mix towards hydropower, the project is set to reduce dependence on coal-based imports from South Africa and Mozambique while advancing the country’s renewable energy ambitions.
According to the International Hydropower Association (IHA), hydropower contributes approximately 40% of electricity in Sub-Saharan Africa. However, an estimated 90% of the continent’s hydropower potential remains untapped, representing a vast opportunity for sustainable energy development.
Sherrill Byrne, Executive Vice President for Energy and Infrastructure at Standard Bank, emphasised the transformative impact of the deal.
“This agreement will unlock vital renewable energy development to strengthen Eswatini’s energy security and affordability. It also represents a significant step in the country’s transition towards cleaner, more sustainable energy sources” she noted.
James Cumming, Chief Executive Officer of ACED, expressed pride in the project’s successful financial close and the commencement of construction.
“This is our first hydroelectric project and our first venture in Eswatini, made possible through collaboration with our committed lenders, shareholders, contractors, the Eswatini Electricity Company (EEC), and all our local partners and regulators. Beyond energy security, this initiative will create jobs and drive socio-economic development in the region.” he stated.
As construction progresses, the Lower Maguduza Hydropower Project is expected to play a crucial role in strengthening Eswatini’s energy independence and fostering long-term sustainability in the country’s power sector.
