London-based private equity firm, Actis LLP, has announced plans to conclude deals on six African power projects in 2021. The emerging markets focused private equity firm looks to double its energy-related investments on the continent within the next five years.
Actis will double its energy investments to $2 billion, and will invest in countries like Nigeria, South Africa, Kenya, Egypt, Ivory Coast and Ghana. The company will mostly focus on wind, solar and gas energy resources, says Lisa Pinsley, head of Africa energy infrastructure at Actis.
This year, Actis is investing between $200 million to $300 million on energy related investments alone.
Actis is a major shareholder in renewable energy independent power producer, Lekela Power, with investments in projects across the African continent. Actis formed Lekela Power with renewable energy company Mainstream Renewable Power which owns a 40% stake in the company. In 2019 Actis also acquired South African based renewable energy developer BioThem Energy from Denham Capital.
Driving Africa’s Energy Transition
Africa’s electrification rate is just over 40%, this is according to market intelligence by the African Development Bank (AfDB). An estimated 600 million Africans are in need of electricity. Actis is increasing its focus investing in renewable energy projects and companies to accelerate Africa’s energy transition.
Africa is plagued with power shortages with Africa’s most industrialised nation South Africa experiencing recurrent power outages that have slowed down economic growth. More investments in Africa’s power sector will be crucial in facilitating the economic recovery objectives of many African countries including South Africa which plans to procure 6,8 GW of new renewable energy capacity over the coming year alone.
One of Actis’s companies, BioTherm Energy, announced the completion of four renewable power projects in South Africa. These projects are expected to add 284 megawatts of electricity to the country’s grid and help improve energy supply challenges. The private equity firm has about 25 power projects in countries across the continent.
Actis is also planning to participate in South Africa’s upcoming bid window of 5 of the country’s Renewable Energy Independent Power Producer Procurement Programme (REI4P).
