https://www.engineeringnews.co.za
Africa|Business|Energy|Power|PROJECT|Projects|Environmental
Africa|Business|Energy|Power|PROJECT|Projects|Environmental
africa|business|energy|power|project|projects|environmental

Distributed generation funding model ideas will ‘evolve’, but regulation critical

30th July 2021

By: Simone Liedtke

Creamer Media Social Media Editor & Senior Writer

     

Font size: - +

New funding model ideas for distributed generation projects will evolve as the market expands, but Rand Merchant Bank (RMB) business development head Hugh Howarden has stressed the importance of government clarifying the requirements for the development and registration of such projects.

President Cyril Ramaphosa in June announced that the licensing-exemption threshold for distribution generation projects would increase to 100 MW and that the new requirements for such projects would be gazette within 60 days.

There is, however, concern that the registration of distributed generation projects could turn into a quasi-licensing requirement, potentially still resulting in significant red tape and delays in the registration of such projects.

Meanwhile, Howarden explained during a South African Photovoltaic Industry Association-hosted webinar this week that project operators could choose between funding a project through a balance sheet, leasing the project or funding it through project finance.

However, moving forward, a combination of these options may generally become the “traditional way of finance” for distributed generation projects.

While he did not give much insight into what this could entail for operators, Howarden did note that stranded assets, for example, would see offtakers “move away from the seven-year debt repayment model”.

Distributed generation, Howarden advised, would be “the future of energy” as new fossil fuel power stations were “becoming increasingly difficult to fund”.

“This will pave the way towards achieving rural electrification and last mile connectivity,” he added, which he said would become “more and more imperative in order to balance out economic growth in [South Africa]”.

This move will have commercial, environmental and community drivers, Howarden said.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

Comments

Showroom

Booyco Electronics
Booyco Electronics

Booyco Electronics, South African pioneer of Proximity Detection Systems, offers safety solutions for underground and surface mining, quarrying,...

VISIT SHOWROOM 
John Thompson
John Thompson

John Thompson, the leader in energy and environmental solutions through value engineering and innovation, provides the following: design, engineer,...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.082 0.139s - 179pq - 2rq
Subscribe Now