Seriti Green CEO Peter Venn
Mining and energy company Seriti Resources’ subsidiary Seriti Green has signed a long-term project financing agreement with Rand Merchant Bank (RMB) and Standard Bank as co-mandated lead arrangers to enable the delivery of a 155 MW wind farm, in Mpumalanga.
The project has a total cost of R4-billion and represents the first phase of a portfolio that will amount to about 900 MW of renewable energy - the Ummbila Emoyeni energy cluster.
The wind farm will be the first renewable energy project to be developed in Mpumalanga, which is traditionally a coal mining and coal-fired power generation hub.
Standard Bank comments the province was not previously considered a viable wind powered location, but it does provider easier access to the grid and marks a move towards decentralised energy for South Africa.
Seriti Green comments that the renewable energy will not only help alleviate South Africa’s energy crisis but also contribute positively to the group’s just energy transition plans.
Seriti Green CEO Peter Venn says alternative power solutions, particularly in Mpumalanga, assist affected communities by investing back into areas where mining, especially that of coal, has been the foundation of the economy.
He explains that the group’s vision is to achieve a just transition by delivering world-class renewable energy projects that unlock sustainable value for generations to come.
Seriti Resources, as the buyer of power from the wind project, through a long-term power purchase agreement, will benefit from a cost-effective tariff and predictable price path, which significantly assists the group in its decarbonisation efforts.
RMB has already applied a first-to-market equity financing solution that generated enhanced shareholder returns in a structure that resulted in significant savings on the cost of capital for shareholders.
The bank has been a long-standing partner of Seriti Resources and was an integral part of the formation of Seriti Green, of which RMB is also a minority shareholder.
RMB infrastructure finance transactor Sindisiwe Mosoeu comments that the partnership between the companies will help Seriti Green become a meaningful player in South Africa’s private power market.