Scatec reaches financial close for its Grootfontein solar projects in South Africa and prepares for construction start
Oslo, 30 June 2023: Scatec ASA, a leading renewable energy company, has reached financial close for its three Grootfontein solar projects in South Africa, won as part of the Department of Mineral Resources’ fifth bidding round of its Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) in 2021.
The solar power plants will be the first Scatec assets located in the Western Cape province of the country and have a total capacity of 273 MW solar power. Once operational the projects will deliver much needed renewable energy under a 20-year Power Purchase Agreement. The three solar plants will lead to a combined abatement of 630,000 tonnes of CO2 emissions annually.
“South Africa is a focus market and this value accretive investment with project returns above our return hurdle, is in line with our strategy to grow profitably and build scale in Sub-Saharan Africa. We are now looking forward to starting construction next year and achieving commercial operation in 2025, while powering approximately 100,000 households in the region,” says Scatec CEO Terje Pilskog.
The power plants have an estimated total project cost of ZAR 5.1 billion (USD 270 million) of which Scatec’s EPC contracts account for approximately 75%. The project will be financed by equity from the owners and ZAR 4.5 billion (USD 241 million) of non-recourse project finance debt provided by Standard Bank of South Africa as mandated lead arranger. This is a landmark transaction as the first REIPPPP Solar PV projects in the fifth bidding round to reach financial close.
Scatec will own 51% of the equity in the project, with H1 Holdings, our local Black Economic Empowerment partner owning 46.5% and the Grootfontein Local Community Trust 2.5%. Scatec will be the Engineering, Procurement and Construction (EPC) provider and provide Operation & Maintenance as well as Asset Management services to the power plants. Construction start is expected during the first quarter of 2024.
For further information, please contact:
For analysts and investors: Andreas Austrell, VP Investor Relations, tel: +47 974 38 686, andreas.austrell@scatec.com
For media: Meera Bhatia, SVP Communications & Government Affairs, tel: +47 468 449 59, meera.bhatia@scatec.com
About Scatec
Scatec is a leading renewable energy solutions provider, accelerating access to reliable and affordable clean energy emerging markets. As a long-term player, we develop, build, own, and operate renewable energy plants, with 4.6 GW in operation and under construction across four continents today. We are committed to grow our renewable energy capacity, delivered by our passionate employees and partners who are driven by a common vision of ‘Improving our Future’. Scatec is headquartered in Oslo, Norway and listed on the Oslo Stock Exchange under the ticker symbol ‘SCATC’. To learn more, visit www.scatec.com or connect with us on LinkedIn.
This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act.
This stock exchange announcement was published by Kine Aaltvedt, Communication & IR Coordinator at Scatec ASA, on 30 June 2023 at 08:28 CEST.
