Energy company Juwi to break ground on R6bn in solar projects

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DUDU RAMELA: A global renewable energy player has announced plans to begin construction on three major private solar projects this year. Juwi Renewable Energies says the investment represents over R6 billion and totals 340 megawatts of capacity.

The projects are expected to make a major contribution to South Africa’s clean energy transition, while serving key players in the mining, data-centre and energy sectors, among others.

Richard Doyle is the managing director of Juwi. He joins us now on the line for more. Thank you very much, Richard, for your time this evening. Perhaps let’s start by taking a look at what informed your investment destination, being South Africa in this case.

RICHARD DOYLE: Good evening, Dudu, and thank you for the opportunity. We’ve been in South Africa for 13 years. In fact, our company’s been operating for 30 years.

We’re a German-owned company with 130 South Africans employed here.

We build projects. We’re not the investor. We build projects.

What’s really significant here is that the private sector is stepping in to invest in renewable energy – not only to improve their own business prospects but to assist in the acceleration of the South African economy. We know that economic growth is enabled by low-cost electricity. We know that Eskom is struggling and coal plants are closing.

We’ve seen today the announcement by Nersa of an increase in electricity prices at three times the inflation [rate].

Renewable energy offers the ability to have low-cost, low-carbon, secured energy prices moving forward, and this is really significant for the growth of our economy moving forward.

DUDU RAMELA: Thank you so much for that clarity. Tell us about these projects – are they still to be launched?

RICHARD DOYLE: These projects have all reached financial close. So they’re funded; the equity and the debt is funded.

We will start construction imminently on all three projects. They’re very large solar PV projects.

One of them will be the largest PV project for a data centre anywhere in the world.

What’s significant is that the projects are all located remotely from where the energy will be used, and deploy something called ‘wheeling’. It’s very important because South Africa has some of the strongest renewable energy resources in the world – [in] remote areas like the Northern Cape where we can create jobs.

We can create 2 000 jobs for the construction, and then move that energy [electricity] into urban environments or industrial environments where land would be expensive, and offer low-cost electricity for these businesses and for consumers in those environments.

So that’s very significant indeed, and one of the first transactions that has some of these features.

DUDU RAMELA: You mentioned the word ‘wheeling’. I’m not sure if I understood properly. What does that mean, please?

RICHARD DOYLE: Well, it means that the solar plants’ electricity is generated in one place and used in another.

The electricity grid is a bit like water pipes where, if you put water in one place, the level rises up at all places simultaneously.

So it’s a very interesting way to allow remote generation of electricity, and that’s then offset through a financial transaction by Eskom and/or the municipalities that are involved.

DUDU RAMELA: Ah, okay. We alluded to it, but who are the immediate beneficiaries of these projects?

RICHARD DOYLE: Well, our clients are the investors, meaning Sasol and Teraco and Glencore Mine.

In two cases there’s an independent power producer between us – our actual clients.

So TotalEnergies and Mulilo are funding the project and selling electricity to Sasol in the one case, and Pele Green Energy is investing in the other project and selling electricity to Glencore. So they will derive benefit as investors.

Banks will derive benefit by providing debt, and the offtakers – meaning Sasol and Glencore and Teraco – will enjoy low-price electricity with a very low carbon footprint, and secure pricing moving forward.

The local communities will also all benefit because jobs will be created and skills will be imparted where the projects are being built.

DUDU RAMELA: Thank you so much for your time this evening. Richard Doyle is the managing director of Juwi Renewable Energies.

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