South African farmers battling power cuts have been thrown a ZAR1.2 billion lifeline to invest in alternative energy sources.

Through the government’s new Agro-Energy Fund, farmers will be able to apply for grants or loans of up to ZAR1.5 million to invest in alternative energy measures.

According to Green Building Africa, the Department of Agriculture, Land Reform and Development  will contribute ZAR500 million to the grants and the Land Bank will finance the loan portion to the tune of ZAR710 million.

Small-scale farmers can apply for blended financing split between a 70% grant and a 30% loan with a maximum value of ZAR 500 000. Medium-scale farmers are eligible for a 50% loan and 50% grant, topping out at ZAR100 million. Financing for large-scale operations  (30% grant and 70% loan) is capped at ZAR1.5 million

Sectors that will get priority include pig farms, dairy farms, poultry, irrigated commodities and on-farm processing.

Applicants to the Land Bank will need to present a business plan and a plan for the alternative energy source and must have an environmental licence and approved licence from the National Energy Regulator of South Africa.

5 September 2023
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