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.  

AREP is an African based energy company focused on clean energy solutions, with a portfolio of 740MW of renewable investments (including wind, solar PV and biomass) providing affordable energy through the utilisation of modern and renewable energy technologies.

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.

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Waterloo Solar begins commercial operations to boost green energy supply

Waterloo Solar, located 10km outside of Vryburg, in the North West province, has commenced its commercial operations, becoming the latest utility-scale solar PV project in South Africa.

This 100% South African-owned solar project in the North West province, brings the total number of large-scale projects constructed in this province to three, in just one year. Boasting 261 360 solar modules, harnessing the intense North West sun, this 75MW project is set to generate enough electricity to power 84 000 homes, via the national grid, each year.

Not only will the solar plant boost the renewable energy sector’s power production, but it will also benefit the rural communities located within a 50km radius of the plant through impactful economic development programmes. During its 20-year operations period, the project will focus on empowering and strengthening the local communities of Vryburg, Kismet Park, Huhudi, Coleridge, and Dithakwaneng within the Naledi Local Municipal area.

Covid-19 humanitarian initiatives, in partnership with various local community NGOs and the Department of Social Development, were supported and funded to benefit a number of these communities, during the project’s construction period.

Additionally, hundreds of local high school learners received career development, which provided Grade 11 and Grade 12 learners with support tools for making improved subject choices linked to personal interests and strengths, in the senior phase of high school. 

Speaking on behalf of the North West Department of Education, the Naledi sub-district manager Fhatuwani Makhado, commended the quality and necessity of the implemented programme that took place across four schools in the district.

Situated on a 171-hectare site, the project was constructed in under two years, having commenced mid-February 2019.  It is connected to Eskom’s Mookodi switching station, which feeds the generated power into the country’s national grid.

At the peak of construction over 500 people, mostly from the surrounding local beneficiary communities, were directly employed.  This is in addition to the employment created through the contracting out of various services. 

During Waterloo Solar’s 20-year operations period, socio-economic development projects will continue to focus on education, as well as youth development, health, food security, and welfare. The programmes have been chosen following research and engagement to ensure that they are well informed and will strengthen the beneficiary communities.

Additionally, a percentage of the revenue generated each year will be committed to implementing enterprise development initiatives, to build resilience and accelerate the growth and success of entrepreneurial businesses, ultimately stimulating local economic growth and creating opportunities for the economic participation of previously disadvantaged groups. The focus is on small and micro enterprises, designed to enhance growth. To deliver on this objective, the establishment of a local resource centre, for use by local SMMEs and communities at large, will support this drive to aid development, whilst the provision of accredited skills training will be provided to start-up businesses.

Waterloo Solar is owned by African Infrastructure Investment Managers (AIIM, a member of Old Mutual Alternative Investments) through its IDEAS Fund, Reatile Solar Power (RF) (Pty) Ltd, Phakwe Solar (RF) (Pty) Ltd, AREP (African Rainbow Energy and Power) and Cicada Community Trust.

The project achieved full quality and grid-code compliance by local Engineering, Procurement and Construction (EPC) contractor Juwi Renewable Energies on 21 November 2020 and is part of the government’s Renewable Energy Independent Power Producer Procurement Programme. It will be operated and maintained, on behalf of the owners, by the Juwi O&M subsidiary company, for the first five years of operations.

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