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Africa-focused independent power producer (IPP) Globeleq has restructured senior debt of USD 37 million (EUR 34m) for the Aries and Konkoonsies solar farms in South Africa, the firm said on Thursday.
The restructuring, led by Standard Bank, will lower financing costs of Aries and Konkoonsies, leading to cheaper electricity for Eskom, the South African national power utility, and ultimately, consumers. Globeleq said that the more efficient capital structure will enable reinvestment in the power sector and faster equity distribution to Aries and Konkoonsies communities and BEE (Black Economic Empowerment) shareholders.
Aries and Konkoonsies have 11 MW of installed capacity each. Both plants have been operational since 2014 under South Africa’s Renewable Energy Independent Power Producer Procurement Programme.
Globeleq acquired majority stake in the solar farms in 2019 and now fully manages operations and maintenance, achieving high availability — above 99%, the IPP says.
With the restructuring of the financing terms, the cost of power reduction is estimated at ZAR 129 million (USD 6.8m/EUR 6.2m) over the remaining ten years of the power purchase agreement, according to Mike Scholey, Globeleq’s CEO.
This follows similar debt restructuring for other Globeleq plants in South Africa in 2021 and 2022 using the government’s refinancing protocol.
(USD 1.0 = EUR 0.919)
(ZAR 10 = USD 0.525/EUR 0.483)
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