SOUTH AFRICA – Independent power producer (IPP) SOLA Group and African Rainbow Energy have reached a financial close on 200MW solar PV projects for Tronox Mineral Sands.
The financial close of the projects happened less than 6 months after the power purchase agreements were signed in mid-March 2022. Construction of the projects will now begin.
The projects’ purpose is to fulfil the obligations of a bilateral electricity sales agreement between SOLA Group and Tronox Mineral Sands.
These renewable energy facilities will supply electricity, through wheeling arrangements with Eskom, to five Tronox facilities in the Western Cape and KwaZulu-Natal for their use.
The SOLA Group is a vertically integrated Independent Power Producer and a leader in the supply of clean energy solutions to private companies in Africa, with a mission to transform Africa through clean energy.
“Tronox’s renewable energy project with SOLA Group will reduce our global carbon emissions by approximately 13% compared to our 2019 baseline,” commented Melissa Zona, Tronox Holdings plc’s Senior Vice President, Chief Human Resources and Sustainability Officer.
“This is yet another example of how Tronox is committed to being a leader when it comes to corporate sustainability and protection of the environment.
“Switching from coal-based to renewable power in South Africa is one of the many ways Tronox is implementing technology and best practices at our sites to protect our land, water, air and ecosystems and operate more sustainably.”
Tronox and SOLA signed a Power Purchase Agreement in March 2022. SOLA’s in-house engineering, finance and project development capabilities have helped accelerate the deal’s conclusion.
“There are significant firsts here for the renewable energy industry,” said Dom Wills, CEO, of SOLA Group.
“These are the first projects of this scale in SA that are based on pure private bilateral trade. It’s also a great plus for the country that these projects are 100% South African owned, financed, constructed, operated and managed.”
Renewable projects are capital intensive and long-term. The projects needed to raise a total of R4 billion (US$4b) of funding for construction and development.
For this to happen, SOLA reached an agreement with a funding partner and shareholder African Rainbow Energy.
“African Rainbow Energy is a Leading Renewable Energy platform, the largest shareholder in the SOLA Group and the funder of the two projects,” said Brian Dames CEO, of African Rainbow Energy.
“This demonstrates African Rainbow Energy’s and partners, Absa, DBSA, Nedbank and Standard Bank’s commitment to our Country, the economy, and our customers. This investment brings hope.”
The debt arrangement was led by Peppertree Capital, and senior lenders included three of the big banks in South Africa and the DBSA who provided a debt into the project.
SOLA also entered into a Joint Venture Agreement with WBHO, for the design and construction of the project, where SOLA performs the engineering services and WBHO will perform the construction. The project comprises 387,000 solar panels mounted on single-axis trackers that track the sun’s position as it moves across the sky.
The project will also be one of the first projects to directly feed into Eskom’s high voltage transmission network.
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