Globeleq, a prominent independent power company in Africa, has successfully concluded a senior debt restructuring totaling US$37 million (ZAR682 million) for its 11MW Aries Solar (Aries) and 11MW Konkoonsies Solar (Konkoonsies) plants situated in the Northern Cape of South Africa. This marks another strategic move by Globeleq following the debt restructuring of several other projects in 2021 and 2022.
Led by Standard Bank Limited, the restructuring aims to reduce the cost of debt for the Aries and Konkoonsies plants, resulting in a significant drop in wholesale electricity prices. The initiative also enhances the capital structure’s efficiency, unlocking funds for shareholders to reinvest in the power sector and facilitating accelerated equity distributions to the Aries and Konkoonsies communities and BEE shareholders.
Both Aries and Konkoonsies, operational since 2014 under South Africa’s Renewable Energy Independent Power Producer Procurement Programme, became part of Globeleq’s majority interest portfolio in 2019. Globeleq has managed the full spectrum of operations and maintenance at both plants since May 2021, achieving an impressive average availability rate of over 99%.
Mike Scholey, CEO of Globeleq, highlighted the positive impact of the debt restructuring on Eskom and South African consumers. The reduced cost of power at the two plants is estimated to be around ZAR129 million over the remaining ten years of the power purchase agreement. This move marks Globeleq’s commitment to being a long-term producer of cost-effective renewable power in South Africa, contributing to energy users’ benefits and encouraging investment in the renewable energy sector.
Sherrill Byrne, Executive Energy and Infrastructure Finance of Standard Bank, expressed satisfaction in partnering with Globeleq once again. The debt financing takeover for the Aries and Konkoonsies Solar Projects is expected to pass on cost savings to Eskom and, ultimately, end consumers. Standard Bank reaffirms its commitment to playing a leading role in the energy sector in South Africa.
