Abstract
Energy generation from intermittent sources such as the sun and wind is faced with inherent resource uncertainty. However, project developers build such uncertainty within their projections and develop their business plans around such assumptions. In most situations, challenges relating to regulatory certainty, optimal pricing, connectivity to the grid, and off-take of the generated electric power are more daunting than the natural factors. The case outlines a situation where South Africa, a resource abundant, power deficient economy, had announced an ambitious program to enhance power generation capacity using cleaner energy technology including solar photovoltaics, concentrating solar power, and wind turbines.
We believe these are initial steps that can open out other opportunities.
—S. Ramakrishnan, Executive Director (Finance), TATA Power Limited, June 2013
Everything we do and deliver today will allow others to realize their vision tomorrow.
The Exxaro brand promise
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Notes
- 1.
Katya B. Naidu, “Tata Power’s Nimble Steps See Lower Equity Investment,” Business Standard, 23 June 2013.
- 2.
The South African Independent Power Production program required local communities to hold a 5 % equity stake projects: The Amakhala Emoyeni Cookhouse Wind Farm Community Trust and the Amakhala Emoyeni Bedford Wind Farm Community Trust would each hold 2.5 % stake in the SPV. The trusts do not inject equity capital but receive dividends that are applied to local development and community projects. In addition, the SPC had committed to spend 1.5 % of revenues on socioeconomic development and 0.6 % of revenue on enterprise development in the region.
- 3.
http://www.cennergi.com/programmes/wind-power/, last accessed 9 July 2013.
- 4.
http://www.nordex-online.com/index.php?id=53&L=2&tx_ttnews[tt_news]=2404&tx_ttnews[backPid]=45&cHash=e3a64ec086, last accessed 9 July 2013.
- 5.
See footnote 3 above.
- 6.
1 USD = 10.1992 on 9 July 2013, http://www.oanda.com/currency/converter/ (rounded off to 1 USD = 10 ZAR for estimations).
- 7.
Funding Pours In for Tata Power JV, 5 June 2013, http://www.gtreview.com/trade-finance/global-trade-review-news/2013/June/Funding-pours-in-for-Tata-Power-JV_10948.shtml, last accessed 9 July 2013.
- 8.
http://www.tata.com/company/Media/inside.aspx?artid=pbELtVk3o2M= Business Standard, 5 June 2013, last accessed 9 July 2013.
- 9.
- 10.
Savannah Environmental Pty Ltd. “Motivation for Amendment of Environmental Authorization,” January 2013, http://www.savannahsa.com/documents/4715/Amakhala%20Emoyeni%20Phase%202%20Wind%20Energy%20Facility%20and%20Associated%20Infrastructure,%20Eastern%20Cape%20Amendment.pdf. Last accessed 14 July 2013.
References
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Sunderasan, S. (2015). Amakhala Wind: Turbulence in the Detail?. In: Cleaner-Energy Investments. Springer, New Delhi. https://doi.org/10.1007/978-81-322-2062-6_4
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