Completed Mixed AidData Chinese Aid

ICBC provides $102.9 million loan to Scatec Solar for Upington Solar PVs Project

$102.9M USD

Funder	Industrial and Commercial Bank of China (ICBC)
Recipient Organization	Dyason's Klip 1 (Pty) Ltd.\|Dyason's Klip 2 (Pty) Ltd\|Sirius Solar PV Project One (RF) (Pty) Ltd
Country	South Africa
Start Date	Apr 01, 2018
End Date	Aug 05, 2029
Duration	4,144 days
Number of Grantees	1
Roles	Recipient
Data Source	AidData Chinese Aid
Grant ID	`58655`

Grant Description

ICBC provides $102.9 million loan to Scatec Solar for Upington Solar PVs Project In April 2015, Scatec Solar was awarded preferred bidder status for the three solar PV projects in Upington in the fourth bidding round under the Renewable Energy Independent Power Producer Procurement (REIPPP) Programme in South Africa.

The Upington Solar Complex is located in Upington, South Africa (阿平顿太阳能项目).

Upon completion, the complex was expected to produce 217 GWh annually and lead to the abatement of more than 180,000 tons of CO(2) emissions annually.

In April 2018, Sirius Solar PV Project One (RF) (Pty) Ltd, Dyason’s Klip 1, and Dyason’s Klip 2 -- three special purpose vehicles, integrated independent solar power producers, and joint ventures of Scatec Solar (42% equity stake), H1 Holdings (35% equity stake), and KLP Norfund Investments (18% equity stake) -- reached financial close for three 86 MW solar PV plants (Sirius, Dyason’s Klip 1, and Dyason’s Klip 2) in South Africa totaling 258 MW.

The three projects involved a total investment of ZAR 4.76 billion.

A consortium of commercial banks and DFIs -- with Standard Bank in the lead -- provided non-recourse project finance of ZAR 3.68 billion, accounting for 77% of the total project cost. The Industrial and Commercial Bank of China (ICBC) provided $109.2 million. Its loan has a CPI-linked interest rate, where the interest rate was 6.43% in 2018-2019 and 8.14% in 2019-2020.

The principal loan amount, as a result, was uplifted based on the yearly observed CPI factor. In 2019, the CPI factor applied to loans was 4.2%, and, in 2020, it was 3.0%. The loan had a maturity date of 2037, making its maturity length 19-years. Construction was originally expected to start in the third quarter of 2018 with grid connection by the end of 2019.

Construction ultimately began in December 2018.

On February 18, 2020, the 86MW first phase of the 258MW PV installation in Upington -- known as known as Sirius -- reached commercial operation. Then, on April 6, 2020, the project as a whole was completed and entered commercial operation.

📋 Staff Comments

Scatec Solar is a European integrated independent solar power producer, delivering affordable, rapidly deployable, and sustainable sources of clean energy worldwide.
The interest rate for this loan is recorded as 7.285% for the time being. This figure represents the average between the applicable interest rates during the 2018-2019 and 2019-2020 terms: 6.43% and 8.14%.
The names of the project companies (SPVs) are identified via https://annualreport2021.scatec.com/wp-content/uploads/sites/10/2022/03/Scatec-Annual-Report_2021-.pdf

📚 Sources & References

2018 PFI Financial League Tables
Scatec Solar completes first phase of 258MW PV project in South Africa
Scatec Solar signs Power Purchase Agreements for 258 MW in South Africa
Scatec Solar’s 258 MW Upington project in South Africa completed
Listing of up to 20,652,478 Private Placement Shares issued in connection with a Private Placement
Annual Report 2019
Annual Report 2020
Project Briefing: South Africa’s largest solar project springs into operation Loan applications and disbursements are still being received and processed as the projects continue to evolve. Ongoing monitoring and evaluation are in place to ensure project continuity.