Healthcare group Mediclinic in US$139m renewable power deal with Energy Exchange

SOUTH AFRICA – Mediclinic, the Southern Africa division of private hospital group, Mediclinic, says it has entered into an agreement with Energy Exchange to procure renewable electricity, in a deal worth R2.1 billion (US$139 million).

The company did not divulge the volume of power to be sourced from Energy Exchange but said the move was part of its ambitious goal of becoming carbon neutral by 2030.

Energy Exchange is an aggregator that allows independent power generators in the country to sell renewable energy for use by industrial and commercial entities.

Mediclinic CEO Ronnie van der Merwe said all divisions of the hospital group were taking steps to reduce their electricity consumption in what would lead to “improved operational efficiency of technical installations, the introduction of various new energy-efficient and renewable technologies, and changes in employee behavior regarding energy use”.

Remgro, the investment company chaired and controlled by Johann Rupert, is a shareholder in Mediclinic and is also one of the founding partners of Energy Exchange.

Since Remgro owns a 35% stake in the company, the agreement is subject to scrutiny by the Financial Conduct Authority.

Energy Exchange, whose board of directors is chaired by Phuthuma Nhleko, the former CEO and executive chair of the MTN Group, describes itself as a leading aggregator of electricity across a technology-diverse range of generators.

Companies across various sectors have taken to renewable energy as a means of overcoming the supply challenges faced by the state-owned power utility, Eskom, and several mining firms have moved to start generating their own solar power.

Self-generation by private entities received a boost early this year when the government lifted the threshold for companies to produce their own electricity without a license from 1 MW to 100 MW.

Mediclinic said the agreement with Energy Exchange is set to have economic benefits, given that annual tariff increases were expected to be inflation-linked.

 

Liked this article? Subscribe to DealStreet Africa News, our regular email newsletter with the latest news, deals and insights from Africa’s business, economy and more. SUBSCRIBE HERE

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.