ICBC provides $102.9 million loan to Scatec Solar for Upington Solar PVs Project

Project narrative

In April 2015, Scatec Solar was awarded preferred bidder status for the three solar PV projects in Upington in the fourth bidding round under the Renewable Energy Independent Power Producer Procurement (REIPPP) Programme in South Africa. The Upington Solar Complex is located in Upington, South Africa (阿平顿太阳能项目). Upon completion, the complex was expected to produce 217 GWh annually and lead to the abatement of more than 180,000 tons of CO(2) emissions annually. In April 2018, Sirius Solar PV Project One (RF) (Pty) Ltd, Dyason’s Klip 1, and Dyason’s Klip 2 -- three special purpose vehicles, integrated independent solar power producers, and joint ventures of Scatec Solar (42% equity stake), H1 Holdings (35% equity stake), and KLP Norfund Investments (18% equity stake) -- reached financial close for three 86 MW solar PV plants (Sirius, Dyason’s Klip 1, and Dyason’s Klip 2) in South Africa totaling 258 MW. The three projects involved a total investment of ZAR 4.76 billion. A consortium of commercial banks and DFIs -- with Standard Bank in the lead -- provided non-recourse project finance of ZAR 3.68 billion, accounting for 77% of the total project cost. The Industrial and Commercial Bank of China (ICBC) provided $109.2 million. Its loan has a CPI-linked interest rate, where the interest rate was 6.43% in 2018-2019 and 8.14% in 2019-2020. The principal loan amount, as a result, was uplifted based on the yearly observed CPI factor. In 2019, the CPI factor applied to loans was 4.2%, and, in 2020, it was 3.0%. The loan had a maturity date of 2037, making its maturity length 19 years. Construction was originally expected to start in the third quarter of 2018 with grid connection by the end of 2019. Construction ultimately began in December 2018. On February 18, 2020, the 86MW first phase of the 258MW PV installation in Upington -- known as known as Sirius -- reached commercial operation. Then, on April 6, 2020, the project as a whole was completed and entered commercial operation.