Emerging New Energy Markets Are Key

Supporting renewable projects in emerging markets is key, says new study

June 20, 2018 (ESI Africa)

“…At the end of 2016, 102 renewable energy projects were selected under South Africa’s REIPPPP, procuring a total of 6,376 MW…However, 460 bids were received, which equates to a total of 26.7GW of capacity…In 2017, Botswana called for an expression of interest for a proposed 100MW solar power project, to which 166 responses were received…Political challenges in South Africa stalled the renewables market for almost three years, but a switch in leadership saw the market begin to flow again almost as quickly as it stalled…[T]his is a prime example of how political factors can impact not only projects but the whole industry [according to a new report from K2 Management]…Despite attractive rates of return, investors can still be preoccupied with political risk, including changes to regulatory and tax regimes, currency non-recoverability and tariff changes…[E]mbedding early risk mitigation measures in governments’ Power Purchase Agreement (PPA) strategy encourages international investment due to lower financial risk…South Africa is ahead of the curve in this regard, as PPAs in the region are underwritten by Treasury, ensuring a backing in the event payment delays are experienced for power…” click here for more

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