Revego Africa Energy Fund Raises R1 Billion to Expand South Africa Renewable Portfolio

Revego Africa Energy Fund has raised 1 billion rand ($62 million) in its first capital-raising round since 2021, strengthening its capacity to finance renewable energy projects across South Africa.

The latest raise includes a 500 million-rand investment from British International Investment Plc (BII) and a matching 500 million rand from Alexander Forbes Group Holdings Ltd.. With the new capital injection, the fund’s portfolio now stands at 3 billion rand.

Chief Investment Officer Ziyaad Sarang said the fund could unlock an additional 250 million rand from BII if another institutional investor matches that commitment.

The newly secured capital will be deployed to finalize Revego’s investment in the 150-megawatt Springbok solar plant in Free State province and to finance five wind power projects across South Africa.

Launched in August 2021 as an open-ended fund, Revego’s initial backers included Investec Bank Ltd., the Eskom Pension and Provident Fund, and UK Climate Investments LLP — a joint venture between the British government and Macquarie Asset Management.

Although the fund maintains a regional focus, all 10 of its investments to date are located in South Africa, which hosts the largest renewable energy market in sub-Saharan Africa. Since inception, the fund has met its target yield of inflation plus 5% to 7%, returning 600 million rand in dividends over four years.

Sarang, who previously led infrastructure at Standard Bank Group Ltd. and now oversees fund initiatives at Investec, aims to double the fund’s size to 6 billion rand within two years and reach 10 billion rand by 2029.

Revego has already developed a pipeline of up to 10 billion rand in operational green projects within South Africa and an additional $100 million in projects elsewhere on the continent. However, the fund plans to maintain its domestic focus in the near term, citing strong local opportunities. Sarang indicated that at least one sub-Saharan project outside South Africa could be added within the next 24 months.

South Africa is gradually phasing out coal-fired power plants and diversifying its energy mix to include renewables and gas to meet future demand. Once Revego reaches assets under management of $750 million to $1 billion, the fund may consider a public listing, Sarang added.

The latest capital raise underscores growing institutional investor confidence in South Africa’s renewable energy sector amid the country’s ongoing energy transition.