Financial close reached on two 100 MW solar projects
SOLA has a number of solar projects, including the 10 MW Aries project in the Northern Cape
SOLA has a number of solar projects, including the 10 MW Aries project in the Northern Cape
Following the regulatory change in August 2021 to raise the licensing limit for distributed generation projects from 1 MW to 100 MW, the first two registered 100 MW energy projects have reached financial close.
The financial close of the projects happened less than six months after the power purchase agreements were signed in mid-March. Construction on the projects will now begin.
The projects’ purpose is to fulfil the obligations of a bilateral electricity sales agreement between vertically integrated independent power producer SOLA Group and Tronox Mineral Sands.
These renewable energy facilities will supply electricity, through wheeling arrangements with State-owned utility Eskom, to five Tronox facilities in the Western Cape and KwaZulu-Natal.
Tronox’s operations are highly energy intensive and this is expected to ensure Tronox’s economic viability and long-term electricity supply affordability.
Tronox’s renewable energy project with SOLA is expected to reduce its global carbon emissions by about 13%, compared with its 2019 baseline.
SOLA’s in-house engineering, finance and project development capabilities are believed to have helped accelerate the conclusion of the deal.
The projects needed R4-billion for construction and development. SOLA reached agreement with funder and shareholder African Rainbow Energy (ARE).
“African Rainbow Energy is a leading renewable energy platform, the largest shareholder in the SOLA Group and the funder of the two projects.
“This is a clear demonstration of ARE’s and partners Absa, DBSA, Nedbank and Standard Bank’s commitment to our country, the economy, and our customers. This investment brings hope,” says ARE CEO Brian Dames.
The debt arrangement was led by PepperTree Capital and senior lenders included three of the big banks in South Africa and the Development Bank of Southern Africa, which provided R3.1-billion of debt into the project.
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