Angola - Solar Project
Volume: €530 Million
Achievment: One of Sub-Saharan Africa’s largest solar projects
Angola is Africa's seventh largest nation with 30 million inhabitants and a rapidly growing economy. While the country is largely dependent on fossil fuels for its electricity generation, a new solar project – the biggest of its kind in sub-Saharan Africa, with seven facilities totalling 370MW – will greatly increase the share of sustainable energy and facilitate the switch to renewable sources.
Eighty-five percent of the project is financed with an export credit worth 560 million euro with a tenure of 18 years from the Swedish Export Credit Corporation (SEK), guaranteed by EKN and arranged by ING Bank. The project fits the recently raised ambitions of the Swedish export finance system to help combat climate change and support sustainable investments using Swedish greentech.
“Climate awareness is rapidly increasing in the financial markets and the export finance system strives to be a positive force in the transition,” says Anna-Karin Jatko, Director General at EKN.
This landmark project will have a huge societal impact on Angola and significantly increase the country’s share of renewable energy. It also fully supports the UN's Sustainable Development Goal 7 of ensuring that all people have access to affordable, reliable, sustainable and modern energy.
“The project in Angola is a milestone within renewable energy and fits perfectly into our framework of green bonds which is linked to the relevant taxonomy,” adds Per Åkerlind, Executive Vice President at SEK, who notes a constantly growing interest from institutional investors worldwide: “The supply side, specifically in the Swedish market, is currently far too thin to satisfy the exponentially growing demand for green investment. As a result, green bonds issued by SEK in the Swedish market is at lower borrowing cost compared with non-green bonds. SEK is transferring that lower borrowing cost by giving green loans more favourable interest rates that make renewable energy even more competitive. We also make sure that the Swedish export credit system is aligned with the Paris 1.5-degree agreement.”
The international market for green bonds has only existed for some 12 years, but already around 15 percent of the Swedish corporate bond market is made up of green bonds, compared with 3–4 percent worldwide.
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