Google Backs First Africa Clean Power and May Invest in More
Google, based in Mountain View, California, put $12 million in the $260 million Jasper solar project in South Africa that will have 96 megawatts of generating capacity, the company said in an e-mailed statement today. A group led by SolarReserve LLC, a closely held U.S. developer, is building the plant near Postmasburg in the Northern Cape province.
“We are always on the lookout to find investments that will have the same characteristics as South Africa, which is strong, growing demand, or supply that is unable to meet that demand,” Google’s Director for Energy and Sustainability Rick Needham said on a conference call. In “parts of eastern Africa, geothermal is one of the natural resources there, so we are looking at those kinds of opportunities.”
South Africa, where utility Eskom Holdings SOC Ltd. struggles to meet rising power demand with coal-fed plants, is expanding capacity through a 100 billion-rand ($10 billion) program to add 3,725 megawatts from renewable sources by 2016. The nation’s investment in clean energy grew more in 2012 than any other country, according to data compiled by Bloomberg. In many sub-Saharan African nations, power demand exceeds capacity, holding back growth.
Eskom will purchase solar power from the Jasper project for 20 years beginning in late 2014, SolarReserve Chief Executive Officer Kevin Smith said yesterday by telephone.
SolarReserve in November received $586 million for two other South Africa projects it’s building to help meet the country’s goal.
The Jasper deal consists of about $195 million in debt and $65 million in equity investments, including Google’s $12 million, SolarReserve spokeswoman Andi Plocek said today by e-mail. FirstRand Bank Ltd. led the debt funding and provided preference share equity, according to the statement.
SolarReserve, based in Santa Monica, California, and project partners Kensani Capital Investments and Intikon Energy provided the additional equity along with state-owned Development Bank of Southern Africa Ltd., non-profit organization P.E.A.C.E. Foundation and Public Investment Corp., which manages South African state workers’ pension fund, the continent’s biggest. Smith wouldn’t provide individual investment terms.
Yingli Green Energy Holding Co., China’s largest solar panel manufacturer by shipments, will supply the equipment for the project.
Google’s investment in Jasper is the second overseas in renewables for the world’s biggest search engine company, which in 2011 paid $5 million to buy a 49 percent stake in a German solar project.
Google also has invested in a transmission project intended to link the first U.S. offshore wind farms as well as land-based wind power and BrightSource Energy Inc. (BRSE)’s first solar-thermal project, which is scheduled to be completed this year in Southern California. Additionally, the company is urging utilities to offer large customers more options for buying renewable energy.
Kensani Eaglestone Capital Advisory was financial adviser for the project, and Baker & McKenzie LLP was the legal adviser.
To contact the editor responsible for this story: Reed Landberg at email@example.com