Africa

Mediclinic to procure renewable energy in a $152 mln deal

2 minute read

The Mediclinic logo is seen in Dubai, UAE February 28, 2017. REUTERS/Ahmed Jadallah

JOHANNESBURG, Sept 3 (Reuters) - Private healthcare group Mediclinic International Plc (MDCM.L) said on Friday its southern Africa division had agreed to procure renewable electricity through Energy Exchange in a deal worth up to 110 million pounds ($152 million).

Procuring renewable energy, specifically electricity, forms part of the group's strategy, which has set an ambitious target to become carbon neutral by 2030, South Africa's biggest private hospital group by market value said.

South Africa, the continent's worst polluter, emits millions of tonnes of carbon dioxide into the atmosphere each year, much of it from coal-fired power plants that still provide most of its energy.

Climate considerations have become a greater concern for investors, with some pulling out of local multibillion-dollar coal-fired power plant projects and halting direct funding.

Companies are also trying to curb their reliance on ailing state utility Eskom, which regularly implements electricity outages.

"While Mediclinic strongly believes that the use of renewable energy is important in ensuring a healthy planet for future generations, reducing consumption by investing in energy-efficient equipment and renewable energy sources also assists in mitigating rising electricity costs," Mediclinic said.

In addition, the agreement with Energy Exchange of Southern Africa will likely provide an economic benefit as the annual tariff increases are expected to be inflation-linked, it added.

Energy Exchange is currently the only platform able to connect businesses with electricity generated by independent power producers (IPPs) in South Africa and which will have the necessary agreements in place with the state utility provider Eskom and local municipalities to make use of their networks, Mediclinic said.

($1 = 0.7233 pounds)

Reporting by Nqobile Dludla Editing by Mark Potter

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