S.Africa renewables firms look for debt savings to lower tariffs

PUBLISHED: Thu, 16 Jul 2020 15:52:36 GMT
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JOHANNESBURG (Reuters) – South African renewable energy companies are looking for ways to make savings on their debt so they can help the government lower power tariffs from older solar and wind projects, the country’s wind energy association SAWEA said on Thursday.

The government opened talks with the renewable energy sector last year to try to secure cheaper electricity to support the flagging economy.

SAWEA said it could take four to six months for companies to negotiate new terms with lenders. Refinancing options include increasing debt maturities or changing types of debt.

JOHANNESBURG (Reuters) – South African renewable energy companies are looking for ways to make savings on their debt so they can help the government lower power tariffs from older solar and wind projects, the country’s wind energy association SAWEA said on Thursday.

The government opened talks with the renewable energy sector last year to try to secure cheaper electricity to support the flagging economy.

SAWEA said it could take four to six months for companies to negotiate new terms with lenders. Refinancing options include increasing debt maturities or changing types of debt.

The government would pass on its share of the gain to consumers through lower tariffs, a refinancing protocol prepared by the energy ministry showed.

When the government approached renewables companies last year about ways to lower power prices, many companies said big savings were impossible to achieve. But they said sharing gains from a refinancing exercise was an option that was unlikely to harm investor sentiment and could contribute to lower tariffs.

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