A responsAbility Managed Climate Fund Commits $10 Million Of Secured Debt For Solar Energy Projects In South Africa
A responsAbility Managed Climate Fund Commits $10 Million Of Secured Debt For Solar Energy Projects In South Africa. A responsAbility Investments AG managed climate fund is investing USD 10 million into Jaguar New Energies (JNE) B.V. to finance a portfolio of solar installations to commercial and industrial (C&I) off-takers in South Africa implemented by New Southern Energy. The long-term financing is split into a senior and junior debt facility to help catalyse the scaling of JNE’s C&I solar business.
According to International Energy Agency, 85 percent of South Africa’s energy is currently sourced from coal. This is both expensive and suffers from old technology and infrastructure, making it unaffordable and unstable for all energy consumers. Further, the national grid operator is providing 95 per cent of the country’s energy and is regularly forced to cut power for several hours at a time, as it fails to keep pace with demand, also known as “load shedding”.
The individual solar energy projects developed by JNE – on roofs or further afield – means that businesses will be able to secure inexpensive and more reliable electricity needed for business operation. This as the national grid operator continues to experience severe issues in providing South African businesses with affordable and reliable electricity. JNE, meanwhile, is solving a critical problem for businesses in South Africa.
Now, in part thanks to eased regulations, JNE customers across South Africa can generate an average 30 per cent of the energy they require from their own solar resources. South Africa recently relaxed its stringent permit rules on solar installations generating over 1 MW to now only requiring licences for projects over 100 MW. This has allowed the commercial and industrial solar market to flourish, given that barriers such as costly and lengthy administration procedures have been removed. Paulo Bello, MD ForestEffect Fund (shareholder of JNE) says: “We are delighted to have responsAbility as a debt provider to JNE for the expansion of a portfolio of solar energy projects across South Africa. The funding secured will provide needed support to build the over 20MW of renewable energy capacity to various offtakers.”
Peter Page, Investment Officer at responsAbility, says: “We are very pleased to announce our collaboration with JNE and scaling the company’s business in providing cost effective and reliable source of power to companies in South Africa. The transaction further deepens responsAbility’ s commitment and expertise in providing climate finance to renewable energy projects across South Africa.”
David Masureik, CEO New Southern Energy, says: “We are excited alongside Jaguar New Energies to be contributing to the uptake of the PPA business model for C&I clients in South Africa. NSE has been at the forefront of the just energy transition and we are grateful for the partnership with responsAbility.“
