PDF - Inside Africa

Solar photovoltaic project in South Africa
Project profile
Our client
FirstRand Bank, acting through its Rand Merchant Bank division.
Project location
The project is located near Groenwater in District Hay, Northern Cape province, South Africa.
Awards
The sister Lesedi/Letsatsi projects won the PFI 2012 African Renewables Deal of
the Year.
Project description
The Jasper project, undertaken by a consortium consisting of SolarReserve South Africa, the
Kensani Group and Intikon Energy, and awarded preferred bidder status under the South Africa
Renewable Energy Independent Power Producer Programme (REIPP), involved the development
and construction of a 96MW (DC) solar photovoltaic plant in Groenwater, Northern Cape. The project
will use more than 325,000 Yingli YL295P-35b multi-crystalline modules with a peak power rating of
295W and 78 INGECON SUN PowerMax central inverters with 1MW AC rated power and an
advanced air cooling system.
Jasper is the consortium’s third solar photovoltaic project in South Africa, being a Round 2 project in
the REIPP. The consortium is also responsible for the Lesedi and Letsatsi projects (each 75MW)
undertaken in Round 1. Combined, the three projects will generate up to 238MW of renewable
energy, enough clean energy to power over 80,000 homes and create approximately 900
construction jobs and 150 permanent operational jobs. During the construction phase the Jasper
project is expected to create 300 jobs as well as 50 permanent and operational jobs, furthering the
achievement of the South African government’s job creation and socio-economic development
objectives. Once operational it is estimated that the plant will generate enough renewable energy to
power more than 30,000 households and offset 145,891 tons of carbon dioxide from the atmosphere
annually.
Status
Construction on the project commenced in 2013.
Matter value
ZAR2,004,829,000 (partially indexed)
Scope of work
Our team in Johannesburg advised FirstRand Bank Limited (acting through its Rand Merchant Bank
division) in its capacity as mandated lead arranger in relation to the funding of the development of
the Jasper project.
We advised on all aspects of the project, including:
debt financing
equity financing
grid connection
insurances, including panel insurances
construction, maintenance and operation
land, environmental and corporate
drafting all finance documents (including facilities agreement, intercreditor agreement, security
documents, hedging agreements, performance guarantees, sponsor support and technical
support agreements)
negotiating the debt and equity financing terms with the borrowers, shareholders, sponsors and
their legal counsel
negotiating amendments to land documents, corporate documents and environmental issues
with the Project Company and its legal counsel
managing and coordinating financial close of the project on behalf of the lenders.
Key issues
Google was provided US$12 million in equity investment in the project. Jasper is the first investment
made by Google in Africa as part of its commitment to invest US$1 billion to accelerate the adoption
of renewable energy technologies globally.
The project was partly funded by preference shares taken up by the senior lenders.
The senior lenders assisted the project company in offering a more competitive pricing to the offtaker, Eskom, by making available an inflation linked term loan facility in addition to a JIBAR linked
term loan facility. As far as we know, it is the only project on the REIPP programme to be financed
with an inflation linked facility.
Once completed, the Jasper power plant will be one of the biggest solar photovoltaic installations in
Africa.
Norton Rose Fulbright US LLP, Norton Rose Fulbright LLP, Norton Rose Fulbright Australia, Norton Rose Fulbright Canada LLP and Norton Rose
Fulbright South Africa Inc are separate legal entities and all of them are members of Norton Rose Fulbright Verein, a Swiss verein. Norton Rose
Fulbright Verein helps coordinate the activities of the members but does not itself provide legal services to clients. References to ‘Norton Rose
Fulbright’, ‘the law firm’, and ‘legal practice’ are to one or more of the Norton Rose Fulbright members or to one of their respective affiliates
(together ‘Norton Rose Fulbright entity/entities’). No individual who is a member, partner, shareholder, director, employee or consultant of, in or
to any Norton Rose Fulbright entity (whether or not such individual is described as a ‘partner’) accepts or assumes responsibility, or has any
liability, to any person in respect of this communication. Any reference to a partner or director is to a member, employee or consultant with
equivalent standing and qualifications of the relevant Norton Rose Fulbright entity. The purpose of this communication is to provide information
as to developments in the law. It does not contain a full analysis of the law nor does it constitute an opinion of any Norton Rose Fulbright entity
on the points of law discussed. You must take specific legal advice on any particular matter.
Law around the world - nortonrosefulbright.com