African Rainbow Energy and Power (AREP) has expanded its investment in the renewable energy sector with the acquisition of a strategic stake in the SOLA Group.
AREP, whose founder and chair is billionaire businessman Patrice Motsepe, is focused on clean energy solutions. It has a portfolio of 740MW of renewable investments, including wind, solar PV and biomass, providing affordable energy through the utilisation of modern and renewable energy technologies.
The SOLA Group has been active in the government market, as well as in the private sector, having been awarded 245MW in Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) projects, 78MW in commercial solar PV and 7MWh in storage projects, respectively. SOLA also recently announced a deal with Amazon.
AREP and SOLA joined forces at the end of 2020, with AREP acquiring a 40% stake and becoming the largest individual shareholder in the group. The deal also includes a significant investment into the group to fund further expansion, AREP announced on Thursday.
"As South Africa transitions its energy usage to more cleaner sources, there is a dire need for new energy generation solutions, collaboration, technology and investment into renewable energy. A critical component of this will be to address the challenges of energy security and job creation in the country," AREP said in a statement.
"The transaction with SOLA allows us to benefit from the utilisation of modern technology to provide affordable electricity, as well as benefit from their expertise in solar photovoltaics (PV). This also supports our strategic focus on delivering clean energy for the commercial and industrial sectors," said Brian Dames, CEO of AREP.
"AREP and SOLA share a vision of using the latest, cleanest technology available to deliver excellent climate and business returns - both for our clients and shareholders." According to Dom Wills, CEO of the SOLA Group, there is very good strategic fit between SOLA and AREP, and the investment comes at the perfect time for a 100% South African-owned private utility to step up and play a meaningful role in tackling the country's electricity challenges.
"South Africans need the cheapest power available from a variety of competitive sources, which can happen through government or private energy procurement. SOLA’s strategy and service offering accommodates both models," said Wills.