Nov 06, 2013
60 MW Free State solar project secures R1.8bn from US development agencyBack
Engineering|Africa|Components|Energy|Nehawu Investment Holdings|New York Stock Exchange|Overseas Private Investment Corporation|PROJECT|Projects|Public Investment Corporation|Renewable Energy|Renewable-Energy|SunEdison|Africa|Bulgaria|Chile|India|South Africa|United States|USD|Development Finance|Electricity|Energy|Solar Energy|Technology Platforms|Davin Chown|Dikobe Ben Martins|Elizabeth Littlefield|Pashupathy Gopalan|Power|Limpopo|South Asia
© Reuse this
The foreign-debt funding, which was facilitated by Absa, amounts to 75% of the R2.4-billion project cost, with the balance of the funding derived from the equity participants.
New York Stock Exchange-listed SunEdison has a 51% stake, with the other owners being the Public Investment Corporation (19%), Nehawu Investment Holdings (20%) and a community trust administered by Kurisani, the investment arm of loveLife (10%).
Boshoff is also the first South African project being developed by SunEdison to have received OPIC support. However, its global project portfolio has benefited to the tune of around $400-million in countries such as Bulgaria, Chile and India.
The plant, which was selected during the second bid window under the Department of Energy’s (DoE’s) Renewable Energy Independent Power Producer Procurement Programme, will be SunEdison’s third in South Africa and is scheduled to begin generating electricity in the fourth quarter of 2014.
Its other two plants, the 28 MW Soutpan and the 30 MW Witkop project, are both located in the Limpopo province and should begin producing in early 2014.
South Asia and sub-Saharan Africa VP Pashupathy Gopalan tells Engineering News Online that the company also submitted several bids during the highly contested third bid window, but none of its projects were listed among the six solar photovoltaic (PV) projects appointed on October 29.
In total, 17 renewable-energy preferred bidders have been appointed across the various technology platforms from 93 bids received by the August 19 closing date.
Gopalan is still hopeful that some of the group’s projects could yet be added to the list of third-window bidders should the DoE decide to approve additional projects.
Energy Minister Dikobe Ben Martins has reported that government is giving serious consideration to the possible extension of the list of bidders and that a decision should be made known in the not too distant future.
Gopalan believes it would be in South Africa’s interest to extend the bidders list, owing to the competitive nature of the offers, as well as the possibility that module prices could begin to rise as the global supply/demand balance begins to even out as a result of manufacturing rationalisation and demand growth.
He is supported in this view by the South African Photovoltaic Industry Association chairperson Davin Chown, who says that the eligible projects offer good value for the country, noting that the prices have fallen materially since round two.
The six successful solar PV bidders, which shared an allocation of 435 MW, were particularly aggressive with their pricing. Fully indexed prices, using April 2011 as the base year, showed that the average solar PV price fell from R2.75/kWh in bid-window one to 88c/kWh in the third round.
Gopalan adds that the localisation aspects of the programme have also improved, with Boshof set to be supplied by a South African majority-owned PV module manufacturer, which has yet to be selected.
About 50% of the project’s total value will go to South African manufacturers and service providers, but many of the key components will be imported.
OPIC president and CEO Elizabeth Littlefield said the agency was “pleased to be supporting a project that will provide a clean and reliable source of electricity and help stimulate economic development”.
Edited by: Creamer Media Reporter© Reuse this Comment Guidelines
Recent Research Reports
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
Real Economy Insight: Road and Rail 2014 (PDF Report)
This six-page brief covers key developments in the road and rail industries over the past 12 months, including details of South Africa’s road and rail network and prospects for both sectors.
Real Economy Insight: Steel 2014 (PDF Report)
This four-page brief covers key developments in the steel industry over the past 12 months. It provides an overview of the global and South African steel and stainless steel markets, South Africa’s major steel producers and events that have shaped these markets.
This Week's Magazine
Multinational semiconductor chipmaker corporation Intel announced its national campaign to further acquire partners to drive its She Will Connect programme, an initiative that aims to expand digital literacy skills to young women in developing countries, further into...
South Africa's MeerKAT radio telescope array programme should get back on schedule within a few months. This assurance has been given by SKA South Africa (SKA SA) associate director: science and technology Prof Justin Jonas. Early last month, Science and Technology...
The Passenger Rail Agency of South Africa’s (PRASA’s) Metrorail service will remain a subsidised service following its current multibillion-rand rolling stock, station, depot and signalling upgrade programme. PRASA group CEO Lucky Montana has allayed fears that...
The uncertainties around the remediation of affected areas as addressed in the Contaminated Land Provisions in the National Environmental Management: Waste Act No 59 of 2008 will possibly spark litigation and disputes between landowners and businesses, contractors...
South Africa is currently the largest component of the African Development Bank’s (AfDB’s) active portfolio in Southern Africa, comprising 62.5% of the bank’s $7.9-billion exposure to the 12-country region – the second largest beneficiary is Mauritius, which...