- Loud, Quiet, or Contextual? What European and African Consumer Behaviour Reveals About Status, History and Power
- Property Investment in Uncertain Times: How to Maximise Returns in a Shifting Economy - Eva August, CEO, Century 21
- Railway infrastructure is one of the solutions to Africa’s Trade Expansion - Caroline Trefault, MSC’s Intermodal Africa Manager
- The Precision Transition: Designing Africa’s power systems for reality, not abstraction
- Three weeks of conflict have tested the logic behind a rand-only portfolio - Harry Scherzer, CEO of Future Forex
Cheap South African Solar Projects Challenged by Cost Surge
LAGOS (Capital Markets in Africa) – Solar projects in South Africa’s latest renewable power procurement round may have difficulty reaching financial close due to issues including rising supply chain costs, according to people familiar with the details.
Some of the bids are experiencing trouble ahead of a deadline to complete financing arrangements, according to the people who asked not to be identified because the information isn’t public. South Africa’s Department of Mineral Resources and Energy expects the projects to close in April. Supply chain issues have emerged for the photovoltaic plants as shipping costs surge, according to one of the people. As an example, freight costs out of China increased 476% and polysilicon prices climbed 365% during the period between January 2020 and November 2021, according to a BloombergNEF report.
Any delay in the projects would mean an additional lag in South Africa’s effort to add generation capacity to a grid that currently fails to meet demand that resulted in record power cuts last year. Plans to expand renewable auctions and bring more power plants online has fallen behind schedule.
In the fifth round, 1,000 megawatts of solar projects with a weighted average price of 429 rand per megawatt hour were chosen, along 1,600 megawatts of onshore wind projects at 495 rand.
Source: Bloomberg Business News