African Rainbow Energy and Power acquires stake in SOLA Group
As South Africa transitions its energy usage to cleaner sources, there is a dire need for new energy generation solutions, collaboration, technology, and investment in renewable energy. A critical component of this will be to address the challenges of energy security and job creation in the country.
Understanding this tremendous challenge and opportunity in investing in the renewables sector, African Rainbow Energy and Power (AREP) has expanded its investment in this sector with the acquisition of a strategic stake in the SOLA Group. The companies joined forces at the end of 2020, with AREP acquiring a 40% stake and becoming the largest individual shareholder in the group. The deal also includes a significant investment into the group to fund further expansion.
“The transaction with SOLA allows us to benefit from the utilisation of modern technology to provide affordable electricity, as well as benefit from their expertise in solar photovoltaics (PV). This also supports our strategic focus on delivering clean energy for the commercial and industrial sectors,” said Brian Dames, CEO of AREP.
“AREP and SOLA share a vision of using the latest, cleanest technology available to deliver excellent climate and business returns – both for our clients and shareholders,” added Dames.
The SOLA Group has been awarded 245MW REIPPPP projects, 78MW commercial solar PV and 7MWh storage projects, respectively. Having started with only four employees in 2008, SOLA now employs over 70 people on a permanent basis, with additional employment of between 30 and 100 staff during the construction of projects.
“Our company is greatly strengthened through this partnership,” said Dom Wills, CEO of the SOLA Group. “There is very good strategic fit between SOLA and AREP, and the investment comes at the perfect time for a 100% South African-owned private utility to step up and play a meaningful role in tackling our electricity challenges.”
Powering economic growth
The transaction comes at a time where the lack of energy security and price uncertainty are limiting economic growth. Renewable energy, and particularly solar PV, has seen huge gains in efficiency, cost effectiveness and speed of deployment – ultimately providing sustainable solutions to help bolster the country’s energy supply.
Many large energy users are opting to procure power privately. Solar PV has the ability to make extra power available faster than other options, including coal and nuclear.
“South Africans need the cheapest power available from a variety of competitive sources, which can happen through government or private energy procurement. SOLA’s strategy and service offering accommodates both models,” adds Wills.
Power in power
The transaction will also see two AREP Directors joining SOLA’s board. “We are excited to tap into the wealth of experience that AREP bring to our company. For our young company, this is as valuable as the financial investment will be,” Wills explains.
SOLA recently announced a landmark deal with Amazon, in the first ever solar PV wheeling project in South Africa. The group will provide 10MW of clean solar power to the global company from a dedicated solar PV facility.View more