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The South African Renewable Energy Independent Power Producer Procurement Programme places economic development obligations on developers. To comply with the local ownership requirement, developers may structure projects so that up to five percent of the shareholding in the project company is held by a local community. A local community that holds in excess of five percent direct or indirect shareholding in the project company is required to have both an economic interest in the…
The economic development obligations placed on developers in terms of the Renewable Energy Independent Power Producer Procurement Programme are fairly onerous and can have far-reaching implications for renewable energy projects in South Africa if protests by unhappy local communities are events of default. To comply with the ownership requirement imposed as part of the economic development obligations, developers often structure their projects so that up to five percent of the shareholding in the project company…