Mozambique-based coal operator Ncondezi Energy has announced a joint venture (JV) with South African-based NESA to target South Africa’s C&I solar and storage markets.
The term sheet agreement signed by the two parties will create a regional company that will acquire assets from both Ncondezi Energy subsidiary Ncondezi Green Power (NGP) and NESA.
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NESA comprises Nesa Capital and Nesa Engineering, an EPC firm. The company manages a 15.5MWp solar plus 0.2MWh storage C&I portfolio (the NIH portfolio) across 66 sites in South Africa.
If successfully implemented, the current combined project pipeline of the JV would lead to 94.5MWp solar PV and 13.5MWp battery storage, as well as 47 possible further projects being developed.
The JV is being lined up to take a controlling stake in the NIH portfolio and will also include NGP assets including a 400kWp solar PV and 0.9MWh battery storage project under construction, and NGP’s project pipeline in Mozambique.
Aiming to create a “Southern African champion”, Ncondezi CEO Hanno Pengilly said the agreement will set the company on a clear pathway towards 100MWp solar PV and 13.5MWp battery storage over the next three years.
NGP will acquire a minimum 40% equity stake in the JV pre new equity capital. The companies have entered into a binding agreement to negotiate on terms which they would acquire, through the JV, a controlling stake in the NIH portfolio by 30 November, with the possibility to acquire 100% within five years.
For NESA, the relationship will mean access to institutional capital to meet funding requirements to scale fast, said Nesa Engineering executive director, Peter Frolich.