Decentral Energy inks R115 million loan agreement with IDC

South African small-scale renewable energy investor and asset manager, Decentral Energy, this week signed a R115 million loan agreement with government owned development finance institution, the Industrial Development Company (IDC). The finance is set to help Decentral Energy with its objectives to develop and expand its pipeline of solar assets in the commercial and industrial sector.

Commenting on the loan advance, Decentral Energy Executive Director Luel Culwick said: “We are so excited to have concluded this agreement with the IDC. It’s a huge milestone that validates the quality of Decentral’s asset portfolio and business model, while also setting us up for vigorous growth by improving the scale and efficiency of our operations.”

“We are delighted to be partnering with the IDC, which has been instrumental in taking Decentral to the next level as we follow our vision to play a key role in moving South Africa towards a clean, reliable, equitable, and efficient energy future,” added Culwick.

Solar assets managed by Decentral Energy

Decentral Energy’s portfolio includes 834 kWp solar system for Southdale Shopping Centre in Johannesburg, 1,2 MWp solar system for the Mega Park industrial complex in Bellville, Western Cape, 514 kWp solar system for the Northmead Mall in Benoni Gauteng.

South Africa’s commercial and industrial solar sector is poised for a major boom after president Cyril Ramaphosa announced government’s intentions to amend Schedule 2 of the Electricity Regulation Act to allow for embedded generation power systems with the capacity of up to 100MW to be connected to the grid without being licensed by the energy regulator NERSA. The announcement was greeted with much celebration by energy pundits and investors who see this as essential to unlock pent up energy potential in the private sector.

Previously, only power systems of up to a 1MW were exempted from licensing requirements. The increase of the licensing exemption threshold to 100MW is projected to unlock at least 5 000 MW in the medium to immediate term, according to Cape Town based think tank, Meridian Economics.