Investment boost continues for SA's renewable sector
Revego Africa Energy Fund increases portfolio of renewable energy investments to nine operating projects
Revego Africa Energy Limited (Revego), Africa’s first YieldCo focused on operating renewable energy projects in sub-Saharan Africa, through its investment in the Revego Africa Energy Fund, has increased its portfolio of renewable energy investments to nine operating projects, through the acquisition of a 34.5% equity interest in Aurora Wind Power (Aurora) and a 7.5% equity interest in Kathu Solar Park (Kathu).
Ziyaad Sarang, Chief Investment Officer of Revego Fund Managers, the investment manager to Revego commented; “we are pleased to be consistently investing in projects which contribute positively towards South Africa’s just energy transition, both enhancing our commitment to climate change and supporting our local communities. At a time of energy insecurity, it is critical that we continue to invest in the local renewable energy sector in order to drive sustainable economic and social development for future generations.”
Built as part of Bid Window 2 of the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP), Aurora is an onshore wind project located on the west coast of South Africa in the Western Cape. Aurora was completed in June 2015 and has a capacity of 94 MW. Kathu, which was built as part of Bid Window 3.5 of the REIPPPP is a Concentrated Solar Power plant located in the Northern Cape. Kathu was completed in January 2019 and has a capacity of 100 MW. Engie Energy International, a leading developer, owner and operator of independent power projects in Africa is the developer and majority shareholder in both projects.
Revego’s portfolio now consists of five solar assets and four wind assets, all of which have 20-year Purchase Power Agreements and generate a cumulative 656 MW, enough to power over 960,000 South African homes with clean energy.
The acquisitions fit with Revego’s strategy of investing in a diversified portfolio of renewable energy assets in sub-Saharan Africa, that have a track record of generating stable cash flows, and that deliver an above-inflation dividend yield over an extended period. Revego aims to play a significant role on the continent by becoming a sizeable investor in operational assets in Africa.
Beyond the clean electricity generation from renewable sources, each plant contributes to socio-economic and enterprise development programs that support various initiatives that benefits the communities located within the vicinity of each plant. As a signatory to the UN Principles of Responsible Investing, Revego is committed to being a responsible investor and continues to have an ESG-integrated investment strategy at its centre.
About Revego Africa Energy Limited (Revego)
Revego is a yield-focused investment vehicle that participates as an equity investor in, predominately, operational renewable energy assets in sub-Saharan Africa with a track record of generating stable cash flows. Revego’s objective is to provide shareholders with long-term stable returns derived from a steady stream of distributions from its portfolio. Revego remains well-placed to make acquisitions and contribute to the development of much needed investment into South African and sub-Saharan African electricity capacity requirements.
Revego Fund Managers (Pty) Ltd. is an authorised Financial Services Provider (FSP number 47561)
Revego Africa Energy Fund acquires 52MW in solar assets
Revego Africa Energy Limited (Revego), Africa’s first YieldCo focused on operating renewable energy projects in sub-Saharan Africa, through its investment in the Revego Africa Energy Fund, has acquired equity interests in a portfolio of three Solar PV assets.
The acquisitions include the Aries Solar Park and Konkoonsies Solar Park, both located in the Northern Cape as well as Soutpan Solar Park located in Limpopo. The acquisitions fit with Revego’s strategy of investing in a diversified portfolio of renewable energy assets in sub-Saharan Africa, that have a track record of generating stable cash flows, and that deliver an above-inflation dividend yield over an extended period.
Built as part of Bid Window 1 of the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP), Aries and Konkoonsies (completed in March 2014) each have capacity of 11 MW and Soutpan (completed July 2014) has a capacity of 30 MW. Globeleq, a leading developer, owner and operator of independent power projects in Africa is the majority shareholder in all three assets.
The Solar plants assist in South Africa’s clean energy transition and generate 105,000 MWh of electricity in aggregate, which is sufficient to power 23,000 homes and avoids over 29,000 of CO2 emissions annually. Local communities in the vicinity of each solar plant also benefit from Enterprise and Socio-Economic Development contributions supporting various school, agricultural and skills programs as well as direct Community Trust ownership.
Revego’s portfolio now consists of four solar assets and three wind assets, all of which have 20-year Purchase Power Agreements.
Ziyaad Sarang, Chief Investment Officer of Revego Fund Managers, the investment manager to Revego commented; “Revego’s long term ambition is to be one of the leading renewable energy investment companies, underpinned by investments in a geographically diverse portfolio of assets that reduce carbon emissions and increase resilience to climate change. With the focus on a just energy transition, we are pleased to be investing in projects that not only provide affordable and clean energy (SDG 7), but also those that support the communities and economies in remote parts of the country (SDG 8 – decent work and economic growth) and that help build the critical infrastructure of the future (SDG 9 – industry, innovation and infrastructure).”
The acquisition is planned to be part-funded through a follow-on commitment from UK Climate Investments LLP (UKCI) into Revego of £15m, a further endorsement of Revego. UKCI is a UK Government International Climate Finance vehicle that targets transformational green energy investments in some of the world’s most carbon intensive emerging economies.
About Revego Africa Energy Limited (Revego)
Revego is a yield-focused investment vehicle that participates as an equity investor in, predominately, operational renewable energy assets in sub-Saharan Africa with a track record of generating stable cash flows. Revego’s objective is to provide shareholders with long-term stable returns derived from a steady stream of distributions from its portfolio. Revego remains well-placed to make acquisitions and contribute to the development of much needed investment into South African and sub-Saharan African electricity capacity requirements.
Revego Fund Managers (Pty) Ltd. is an authorised Financial Services Provider (FSP number 47561)
Revego Africa Energy Limited secures 360MW in Mainstream wind assets
Revego Africa Energy Limited (Revego), South Africa’s only yieldco geared towards the renewable energy sector through its investment in the Revego Africa Energy Fund, has acquired stakes in a number of leading wind assets, all of which are helping to build South Africa’s clean energy future.
The acquisitions include the Mainstream wind assets, Loeriesfontein 2 Wind Farm, Khobab Wind Farm and Noupoort Wind Farm, situated in the Northern Cape.
Loeriesfontein and Khobab (completed in December 2017) each have capacity of 140 MW and Noupoort (completed July 2016) has a capacity of 80 MW. The assets were built as part of Bid Window 3 of the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP), led by sponsors Mainstream Renewables SA, a leading developer of wind and solar PV projects.
Eskom is the sole off-taker for all power produced by the three wind farms through a 20-year Power Purchase Agreement (PPA) as part of the REIPPP. The PPA is backed by the Government Support Framework Agreement (GSFA), whereby the South African government provides support to Eskom in an event of default.
Revego has purchased the wind assets from Metier, one of Africa’s leading private equity fund managers, and Lereko, who jointly manage the Lereko Metier Sustainable Capital fund. The acquisition fits in with Revego’s strategy of taking stakes in operational renewable energy assets in sub-Saharan Africa that have a track record of generating stable cash flows and that deliver an above-inflation dividend yield over an extended period.
Metier’s Sustainable Capital practice targets investments in energy efficiency, renewables, water and waste management businesses, as well as projects supporting Africa’s development objectives and environmental commitments.
“We are pleased to have played a part in three of the largest wind assets in South Africa and their contribution to building a thriving renewable energy sector in the country” said John Hannig a principal in Metier’s Sustainable Capital practice.
Revego CEO Reyburn Hendricks says that collectively, the three wind farms generate clean renewable energy, supplying electricity to power up to 310,000 South African households, positively impacting the country’s economy and its people.
“As a renewable energy source, wind power generates zero carbon emissions and uses only a minimal amount of water, unlike traditional power stations. This makes it the perfect energy source for a region of the country that is characterised by high winds and arid conditions,” he explains.
In addition to the provision of electricity to households in their areas, the wind farms have also contributed to social and economic upliftment. “Local communities have a direct shareholding in the assets, while the wind farms also employ and train people from the community, helping to build a skill set in what is likely to be a growth industry in the future,” adds Hendricks.
“We are proud of the wind farm portfolio which together with our fellow shareholders Genesis evolved from development through to operations. This achievement is aligned with our objective of ensuring our investments generate additionality for both the environment and importantly local communities in remote areas where opportunities can be limited. We wish Revego the very best for the next chapter” said Marc Immerman, principal in Metier’s Sustainable Capital practice
Hendricks also points out that the wind assets directly address a number of the UN’s Sustainable Development Goals (SDGs), in particular SDG 7 (affordable and clean energy), SDG 8 (decent work and economic growth), SDG 9 (industry, innovation and infrastructure) and SDG 13 (climate action).
“The investments therefore fulfil the environmental, social and governance (ESG) requirements of our investor base,” notes Hendricks.
He adds that all three wind farms continued operating in full during the Covid-19 lockdowns, with staff following Covid-19 protocols. “Local healthcare centres have been able count on the essential power and water supplies provided by these assets, in order to treat patients during the third wave of the pandemic,” says Hendricks.
Revego’s portfolio now consists of three wind and one solar asset, and has secured a wind and a solar asset, all of which have 20-year PPAs with Eskom, thus providing the long-term, stable cash flows investors seek. In addition to the three mainstream wind assets noted above, Revego’s assets will include:
Aurora Wind Power – a 94MW wind farm located in the Western Cape, built as part of Bid Window 2 of the REIPPPP, and led by sponsor Engie Energy International, one of the largest energy players globally and have extensive experience in developing and operating renewable energy plants. Aurora became operational in June 2015 and has a PPA with Eskom until June 2035.
Kathu Solar Park – a 100 MW concentrated solar power thermal energy project located in the Northern Cape. It was built as part of Bid Window 3 of the REIPPPP, led by sponsor Engie Energy International.
The project became operational in February 2019, with a 20-year PPA, valid until February 2039.
Bokpoort CSP – a 50MW concentrated solar power (CSP) thermal energy power plant located in the Northern Cape. It was developed by Metier and built as part of Bid Window 2 of the REIPPPP, led by sponsors ACWA Power, one of the largest energy players globally with extensive experience in developing and operating renewable energy plants. The project became operational in March 2016 with a 20-year PPA, valid until March 2036.
“We are pleased to have rapidly built up scale within Revego in some of South Africa’s most important renewable assets and to be able to provide our investors with the basis to meet their sustainability and return goals,” concludes Hendricks.
About Revego Africa Energy Limited (Revego): Revego is a yield-focused specialist BEE investment vehicle that will participate as an equity investor in, predominately, operational renewable energy assets in sub-Saharan Africa with a track record of generating stable cash flows. Revego aims to provide shareholders with a targeted dividend yield of approximately 9% – 11% and will seek to increase this dividend yield over time, with a targeted yield to maturity of approximately 11%.
About Metier: Metier is an independent private equity fund management business with a proven track record in Africa spanning four decades. Metier’s Sustainable Capital Practice has garnered significant traction since its inception in 2010. The practice targets investment in energy efficiency, renewables, water and waste management businesses and projects supporting Africa’s development objectives and environmental commitments.
Revego Fund Managers (Pty) Ltd. is an authorised Financial Services Provider (FSP number 47561).
Chief Executive Officer, Reyburn Hendricks is interviewed on the MoneywebNOW show, on 28th April 2021
Revego Africa Energy Limited invests in leading South African concentrated solar power plant
Revego Africa Energy Limited (Revego), has announced its first major acquisition, in the form of a 12% stake in the 50 MW Bokpoort Concentrated Solar Power (CSP) asset in the Northern Cape for R204 million.
Bokpoort CSP is one of South Africa’s premier CSP projects and fulfils Revego’s mandate of investing in operational, dividend-earning renewable assets. Revego is buying the stake from Metier, one of South Africa’s leading private equity firms, who manages the Lereko Metier Sustainable Capital fund.
Bokpoort CSP is a 50MW plant run as an independent power producer, with Saudi Arabian based ACWA Power International acting as the operational partner.
Bokpoort CSP was one of the first CSP projects in South Africa under the Renewable Energy Independent Power Producer Procurement (REIPPP) programme. It is unusual among renewable energy projects in that it has significant energy storage onsite in the form of thermal salt storage. It recently became the first renewable facility in Africa to complete a full week of continuous operations, going on to run continuously for 13 days using its onsite storage. It also claimed the record as South Africa’s largest infrastructure refinancing transaction, of approximately R5bn.
Reyburn Hendricks, CEO of Revego, says the Bokpoort CSP acquisition is an important first step towards building the Revego portfolio. “The economics of the acquisition stack up well – Bokpoort CSP is backed by a 20-year Power Purchase Agreement with Eskom, supported by government guarantees, and with a power tariff indexed to the Consumer Price Index,” he argues. “Our investment team also has expertise in renewable energy acquisitions and the complexities of CSP technology.”
Hendricks adds that a major part of Revego’s strategy is to provide a viable option to early-stage investors in renewable projects. “These are investors whose investment objective have been achieved, such as private equity firms or sponsors looking for an exit, BEE investors looking to realise gains or redeploy capital, or REIPPP investors wanting to liquidate their holdings into cash,” he explains.
In this case, Metier was looking to realise its investment in a project in which it has been involved from the outset, from site identification through to successful operation. Partners Marc Immerman and Michael Goldblatt with Metier and Lereko and supported by the Industrial Development Corporation, initiated the Bokpoort CSP project and were active throughout the entire development, construction and operational periods.
This was part of Metier’s sustainable capital practice, which targets investments in energy efficiency, renewables, water and waste management businesses, as well as projects supporting Africa’s development objectives and environmental commitments.
Goldblatt says Metier is proud of the role it has played in bringing Bokpoort CSP to where it is today. “In addition to a well-operated and significant renewable plant on the South African grid, we also leave a lasting legacy of extensive and successful socio-economic development programmes implemented in the local community, including a comprehensive youth centre, a farming ownership programme, school feeding vegetable gardens, and bursaries for local students amongst others. We are confident that Revego, alongside other shareholders, will continue to take the project from strength to strength.”
The Bokpoort CSP acquisition ahead of the listing of Revego on the JSE, has been funded through a bridge facility provided by Investec Bank. Investec is also a cornerstone investor in Revego, alongside UKCI, a joint venture between the Green Investment Group and the UK government and the Eskom Pension and Provident Fund.
About Revego Africa Energy Limited (Revego): Revego is a yield-focused specialist BEE investment vehicle that will participate principally as an equity investor in, predominately, operational renewable energy assets in sub-Saharan Africa with a track record of generating stable cash flows. Revego aims to provide Shareholders with an initial dividend yield of approximately 9% – 10% and will seek to increase this dividend yield over time, with a targeted yield to maturity of approximately 11%.
About Bokpoort CSP: Bokpoort CSP is a 50 MW concentrated solar power project that was selected as the only CSP plant in the second round of the REIPPP. The plant is located in a rural area of the Northern Cape Province, 120km south east of Upington. Bokpoort CSP is structured as an independent power producer, with Saudi Arabian based ACWA Power International acting as the operational partner. Bokpoort CSP is project financed based on a 20 year Power Purchase Agreement with Eskom, supported by government guarantees, with a power tariff indexed with CPI. The project uses CSP trough technology which currently makes up the bulk of the installed base of global CSP capacity and has a thermal energy storage capacity of 1 300MWh (thermal), equivalent to about 9.5 hours of operation. The plant draws water from the Orange River through a dedicated pipeline. The R5.1 billion project started commercial operations in March 2016 and has been operating successfully since commissioning.
About Metier:
Metier is an independent private equity fund management business with a proven track record in Africa spanning four decades. Metier’s Sustainable Capital Practice has garnered significant traction since its inception in 2010. The practice targets investment in energy efficiency, renewables, water and waste management businesses and projects supporting Africa’s development objectives and environmental commitments.
Revego Fund Managers (Pty) Ltd. is an authorised Financial Services Provider (FSP number 47561).
The Revego Podcast Series
We discuss the future of renewables as an investment theme, and Revego's investment case. Our panel includes experts from the industry and the Revego team, moderated by Chris Yelland, energy analyst and managing director of EE Business Intelligence.
How Africa can drive the global clean energy transition.
Africa’s power and energy challenges – but abundance of renewable energy sources – also make it the continent best positioned to lead the transition to clean energy.
In this episode, the panel unpacks the concept of renewable energy – how it differs from other forms of energy, where it fits into the overall energy universe – but also discuss why renewables could be the solution for reducing the world’s dependence on fossil fuels as well as why Africa can drive that change.
Panellists: Abel Mjiyako, Chief Technical Officer at Revego Fund Managers and Dieter Matzner, a power and infrastructure consultant at Investec Bank
Building, owning and operating an independent power producer (IPP).
Independent power producers have a particularly relevant role to play in South Africa (and the rest of the continent), to both meet rising power demand and to do so in a way that has a minimal impact on the environment. In this episode, our panellists discuss the IPP landscape, the role they play in meeting energy demand and the specific requirements and challenges of operating an IPP.
Panellists: Mike Meeser, chief investment officer, Revego Fund Managers; Ziyaad Sarang, chief financial officer, Revego Fund Managers and Mo Hoosen, head of power and gas, ENGIE Africa
Revego listing to give investors access to growing renewable sector.
Renewable energy is an obvious area for investors looking to get exposure to one of the most important investment themes of our times. Yet the local landscape for investing in renewables is limited at the moment. In this episode, the Revego team explains the investment structure of the fund and the type of investor likely to invest.
Panellists: Reyburn Hendricks, chief executive officer of Revego Africa Energy Limited and Mike Meeser, chief investment officer, Revego Fund Managers
Earning an attractive yield while building the renewables sector.
From investors looking for an attractive yield, to those looking to contribute to reducing the global carbon footprint, Revego’s upcoming listing is exciting news.
There is a lot of jargon in the market when it comes investing in the renewables sector. In this episode, we cut through the jargon and highlight the key things investors should look at when considering an investment in a yieldco such as Revego Africa Investments Energy Limited, which makes its debut on the JSE this year.
Panellists: Jarrett Geldenhuys, head of South African Equity Capital Markets, Investec Bank; Marnus Terblanche, corporate finance, Investec Bank and Ziyaad Sarang, chief financial officer, Revego Fund Managers
Investec’s R1bn fund to buy up stakes in SA green power projects
The investment vehicle, set up with UK Climate Investments, wants equity in operating renewable energy projects
Investec Bank and UK Climate Investments have set up a R1bn investment vehicle to buy assets under SA’s green power programme. The vehicle, Revego Africa Energy Limited, is expected to list on the JSE by June 2019 where it hopes to raise another R1bn to invest in operating renewable energy projects. Also newly incorporated is the majority black-owned Revego Fund Managers, which will manage Revego’s investments.
R12bn Kathu Solar Park goes commercial
Commercial operations at the R12 billion Kathu Solar Park have commenced.
Located in the Northern Cape province, the 100MW Kathu solar power plant accomplished its first synchronisation to the national grid in November last year.
Constructed by SENER and ACCIONA Industrial, Kathu has an installed capacity of 100MW. It will allow clean energy to be supplied to 179 000 homes in the Northern Cape province and prevent the emission of six million tonnes of CO2 into the atmosphere over the next 20 years.
Aurora Wind Power starts commercial operation of the West Coast 1 wind farm
Company Announcement - The West Coast 1 project is part of the Renewable Energy Independent Power Producer Procurement programme, through which South Africa intends to procure 3,625 MW of renewable energy by the end of 2016, to help curb its reliance on coal for electricity and contribute towards carbon emission reduction objectives.
West Coast 1 will allow for an offset of an estimated 5.6 million tonnes of CO2 over the 20-year duration of its Power Purchase Agreement.
ENGIE holds a 43% equity stake in the project, while Investec Bank Limited (“Investec”) holds 34.5% and KTH 20%. The remaining 2.5% has been allocated to a Community Trust, for the purpose of developing and sustaining the surrounding community. Vestas supplied the forty seven 2 MW wind turbines, and will also be charged with the long term service of the facility. The construction of West Coast 1, which started in June 2013, created more than 600 jobs, 450 of which were for surrounding communities.
Investec, UK Climate Investments commit R1bn for renewable energy in Africa
One billion rand has been committed towards Africa’s renewable energy.
Investec Bank and UK Climate Investments are equally putting this billion rand for a renewable energy investment vehicle in the continent. This project will be managed by an incorporated majority black owned fund manager, Revego. Michael Meeser, CIO of Revego Fund Managers joins CNBC Africa for more.