Opportunities on-and-off grid in sub-Saharan Africa

Opportunities in Africa - adapting the business model

David Donnelly - Partner - Mazars LLP

#SEUK

Opportunities in Africa - adapting the business model

David Donnelly – Project Finance, Mazars LLP

About Mazars

Global accounting, tax and advisory firm – present in 72 countries

• 24 in Africa

Team of 60 Project Finance professionals

• London, Johannesburg, Paris, New York and Delhi

Solar experience in Europe, Africa, Middle East, US

• Multiple transactions in UK

• Energy project experience in 8 countries in Africa

The challenges are significant and exciting …

for the right type of sponsor

African market entry is far more complex than entry to another EU / OECD market:

• You cannot presume grid access

• You cannot presume a creditworthy PPA

• Bankability is far from automatic

• Few countries have effective feed-in tariff regimes

• Demonstrating affordability is key

Building stakeholder relationships is essential –government, utility, regulator, IFIs, commercial banks, communities

Developing a strategy

Focus on what you bring

• Excellence in project design, procurement, project management and operations, financial expertise

Identify your preferred market

• IPP track records, IFI supported RE programmes

Adopt local expertise

• Identify local partners

Consider your project as electricity supply, not just generation

• Physical and contractual route to market

• Variety of commercial models

• Convince stakeholders of project affordability

The prize

High margins and equity returns

• Early market entrant gains

Market growth potential is enormous

• Over 600 million people have no electricity access

You can win the affordability argument

• The economic and social cost of undersupply is massive

The contents of this presentation are confidential and not for onward distribution. Disclosure to third parties cannot be made without the prior written consent of Mazars LLP.

Mazars LLP is the UK firm of Mazars, an international advisory and accountancy organisation, and is a limited liability partnership registered in England with registered number OC308299. A list of partners’ names is available for inspection at the firm’s registered office, Tower Bridge House, St Katharine’s Way, London E1W 1DD. We are registered to carry on audit work in the UK and Ireland by the Institute of Chartered Accountants in England and Wales. Details about our audit registration can be viewed at www.auditregister.org.uk under reference number C001139861.

© Mazars LLP 2015

www.mazars.com

Thank you

David Donnelly

Project Finance – energy

Mazars LLP

T: + 44 (0)20 7063 4561

E: david.donnelly@mazars.co.uk