How these businesses found the right funding for renewable energy projects
Finding the right funding for renewable energy projects in your business can be a daunting venture. But these businesses have successful stories to tell after partnering with the right institution.
Whether it is to battle rising electricity costs, avoid loadshedding, become more responsible in managing emissions output, or listening to the growing concerns of environmentally and social impact awareness of consumers, many businesses are now investigating the potential of renewable energy to generate power.
In the past year, these three businesses in particular have found success after partnering with Nedbank Business Banking to help reach some of their Sustainable Development Goals.
These include:
- Funding solar equipment for a well-known ice cream manufacturer in Cape Town to help lower costs;
- Helping a mushroom farmer source equipment to keep temperature-controlled climates consistent in growing-rooms;
- Assisting a fruit farmer in the Western Cape to lower electricity costs and emissions by installing solar panels;
36 000 kwh generated from renewables
In the case of the KwaZulu-Natal mushroom farmer, the family-run business determined that its average annual cost of electricity has increased over the past years and is forecasted to increase even further in 2021.
Mushroom farming is dependent on complete climate control of the growing environment, which means a total reliance on continuous supply of electricity, with the business' electricity costs its second largest expense.
With the help of Nedbank, a funding solution was put in place to finance a capacitor-bank, electric motors, a boiler using solar heating and a chimney that recovers heat to warm water. A diesel generator was installed, and all lighting transformed to LED lights.
All in all, this sustainable solution ultimately saved the business money on a monthly basis, while being able to offset the costs of the financing structure within the next six years. The new equipment now generates 36 000 kwh of electricity per month from renewable energy sources. The business also financed space of 5 000 square metres, and has the future option to expand the property over a 15-year financing period.
Leading the charge
According to Mark Boshoff, Head of Sustainability at Nedbank Commercial Banking, banks play a critical role in providing not only finance but also expertise on the subject.
"Global sustainability issues require the finance sector leads the charge to adapt as businesses operate in a closed ecology. Banks can promote new economic and business models to their clients."
Some of the key areas in which banks assist include:
- Assisting businesses to transition away from practices that undermine their SDG goals. By internalising these lessons in their own banking operations, they can be proactive in creating sustainable solutions.
- By increasing efforts to reach the unbanked, creating green economies and financing sustainability technology, the finance sector can help eliminate poverty, create jobs, improve healthcare and promote equality.
- Commercial banks are also key to financing the substantial investment required to attain SDG Goals. Banks fund specific projects and reviewing the financial services they offer in order to assist clients to meet their own consumers’ expectations.
Going with the green bank
Known as the 'green bank', Nedbank has been leading its own change internally in finding innovative funding solutions to assist businesses in investing in sustainable practices, equipment and technology. It has also made its own commitments to meet United Nations’ SDG goals ahead of 2050, including becoming 100% carbon neutral.
The bank offers a wide range of funding products including renewable energy, water, food production, and waste recycling, and solutions can be tailored to individual business needs, having expertise in both commercial and agricultural spaces.
"Climate change and sustainability are at the core of everything we do at Nedbank and our focus on renewable energy, water, and soil health are examples of how we are encouraging our clients to transition to sustainability through our lending," says Nedbank Head of Agriculture John Hudson – whose team would have been instrumental in assisting the KZN mushroom farmer.
Boshoff meanwhile says Nedbank can help in three ways:
The terms and pricing of the funding offerings are tailored to the unique nature of sustainability related equipment taking into account longer pay-back periods, break-even points, and savings generated.
Offerings include options to directly own the equipment or rentals, and third-party ownership where only the electricity or recycled water is paid to a producer of the resource.
Offerings include solutions for home-owners, businesses, and utility scale sites, such as solar farms.
"Our financing products ultimately assist our clients to create sustainable value through the reduction of their environmental impacts and enable them to operate more efficiently and safely," says Boshoff.
To learn more about Sustainability at Nedbank, click here.
If you would like a Call Back from a trusted Nedbank adviser, then find out more here.
Source: Fin24
Nedbank Commercial Banking enables our partners with the products and services they need to sustain their businesses in ways that are commercially sound, yet sustainable and supportive of the economy and the people who rely on it for their livelihoods.
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