How collaboration helps deliver the promise of renewable energy

Nato Oosthuizen, Partner and head of renewable energy 

Christelle Grohmann, Partner: strategic development and advisory

The right advice when planning, bidding for or implementing renewable energy infrastructure is key. BDO SOUTH AFRICA works with both the public and private sectors to ensure all relevant boxes are ticked

Renewable energy projects and their positive impact on the climate are vital to the future of the world. They are complex projects that generally involve public-private partnerships (PPPs) and need a company like BDO South Africa to provide advisory services to help these entities navigate such complex challenges through the provision of ¬ financial, advisory and compliance services, among others. Nato Oosthuizen, partner and head of renewable energy at BDO South Africa, says there are multiple phases to a renewable project, with different organisations involved in each, and different services to be rendered. BDO, he explains, offers services across the scope of a project, from development, through construction and into the operational phase. “We offer a range of services from a corporate legal perspective. From helping set up the entities and structures needed to develop the energy-delivering enterprise and assisting with crunching the numbers and developing ¬ financial models to running sensitivity analysis and even forecasting the project’s overall viability, we can do it all,” he says. “From a legal and tax point of view, we can help set up the optimal structure for the entity, while assisting with ¬ financial, economic and skills-impact assessments, helping to determine the potential economic impact on surrounding communities, and the job creation potential of the project.” BDO further helps clients with their bid submissions – ensuring they are bid-ready by collating the necessary documents, streamlining the numbers and developing more detailed technical input – essentially, making sure all the relevant boxes are ticked. “If the client is successful, we can then offer services, such as auditing, accounting, payroll and tax assistance, as well as provide advice around compliance and the Companies Act. So, we are able to walk a long journey with them, as their business advisor of choice,” he notes. 

 

CHALLENGES AND RISKS 

Christelle Grohmann, partner: strategic development and advisory at BDO South Africa, adds that the creation of PPPs in such instances is vital, as these ensure that all the risk does not lie in one place, while making sure that the infrastructure development needed to grow the economy is implemented. “Often, an energy project is considered as the ¬test phase towards a larger economic impact – such as the implementation of an industrial zone. The challenge for government is that it needs the energy to be available before it can implement such a plan, creating a ‘chicken-and-egg’ scenario. BDO can offer advice around the various ways to get the ball rolling to ultimately deliver such larger bene¬fits,” she says. Oosthuizen suggests that when a PPP is entered into, plenty of forward-forecasting and thinking is required, which is captured in a complex ¬ financial model. “We work with the client – who may be from government or the private sector side – so they can more clearly understand this complex model, how it works, how to assess potential sensitivities, and how to properly interpret the data to make the best decisions. It is very much a collaborative process.” Grohmann indicates further that the key to a successful renewable project lies in government and the private sector working together to ¬ nd a solution that will deliver the services people need. “Government’s role is to provide the facilitating environment, while the private sector must bring the funding and expertise. Working together, they can build effective facilities that can help the country develop smarter cities, thereby creating both jobs and economic growth. “As for BDO, we see our purpose as assisting wherever we can to achieve these dreams. Ultimately, we are part of society, so although our core focus remains on our clients, it is gratifying to be part of a bigger picture, helping craft the right solution that will enable SA to grow the economy and build a stronger nation,” she concludes.

“THE KEY TO A SUCCESSFUL RENEWABLE PROJECT LIES IN GOVERNMENT AND THE PRIVATE SECTOR WORKING TOGETHER TO FIND A SOLUTION THAT WILL DELIVER THE SERVICES PEOPLE NEED.” – CHRISTELLE GROHMANN