South Africa: Structuring commercial contracts solar and wind for Standard Bank

Norway-based Scatec Solar has begun construction on a 75 MW photovoltaic project in South Africa. The plant will be built on the Northern Cape, in Kalkbult. The plant will produce in excess of 145 million kWh annually. The electricity will be sold to Eskom under a 20 year PPA.

The €200 million capital investment needed for the project will come from South Africa’s Standard Bank. Meanwhile, Scatec Solar is the majority owner and will provide equity financing, along with Standard Bank, Old Mutual Life Assurance Company and Simacel.

Associate Director of Voltiq Sabine Christiaens, has advised Standard Bank, as equity investor, on the EPC and O&M contracts and has assisted Standard Bank in bringing the project to financial close.

Nordex, the German wind turbine manufacturer has been awarded the contract for the delivery and installation of the 80 MW “Red Cap Kouga” wind farm near Port Elizabeth on a turn-key basis. The work includes the construction of the foundations and road access as well as cabling and the transformer station and is scheduled to start in April 2013.

Nordex will be supplying 32 N90/2500 strong-wind turbines and installing them at the coastal site, which is characterised by mean wind speeds of around 9 m/s.

The customer and ultimate operator of the Kouga project is Red Cap Kouga Wind Farm Pty. They are funded by Cape Town-based investment management firm Inspired Evolution, the Standard Bank of South Africa and the IDC.