Globeleq, an independent power company in Africa, has completed a US$37 million (ZAR682 million) senior debt restructuring for its Aries Solar (11MW) and Konkoonsies Solar (11MW) plants in the Northern Cape of South Africa.
This marks another milestone for Globeleq, following the completion of debt restructuring for various other projects, including the Jeffreys Bay Wind Farm, De Aar and Droogfontein solar plants in August 2021, and the Soutpan solar plant in January 2022.
Led by Standard Bank, the restructuring aims to lower the cost of debt for the projects, resulting in a substantial reduction in wholesale electricity prices from the Aries and Konkoonsies plants.
The more efficient capital structure achieved through the restructuring will also release funds for shareholders to reinvest in the power sector, further accelerating equity distributions to the Aries and Konkoonsies communities and Black Economic Empowerment (BEE) shareholders.
Aries and Konkoonsies, both operational since 2014 under South Africa’s Renewable Energy Independent Power Producer Procurement Programme, came under the majority ownership of Globeleq in 2019. Since May 2021, Globeleq has overseen the full scope of operations and maintenance at both plants, achieving an impressive average availability rate of above 99 percent.
“Restructuring the financing terms of these projects continues to be of significant benefit to Eskom and to South African consumers. We have reduced the cost of power at these two plants by around ZAR129 million over the remaining ten years of the power purchase agreement,” Mike Scholey, CEO of Globeleq, said.
“We have partnered with Globeleq and taken over the debt financing of the Aries and Konkoonsies Solar Projects, allowing for cost savings to be passed through to Eskom and ultimately to the end consumers. Standard Bank is committed to being a leading player in the energy sector in South Africa,” Sherrill Byrne, Executive Energy and Infrastructure Finance of Standard Bank, said.