Following widespread power outages across South Australia in early 2017, energy security has become an issue of national importance in Australia and a crucial problem to solve. Reach Solar Energy, a new player in the market, identified an opportunity to build a solar farm near Port Augusta in South Australia – Project Bungala – that could potentially power 130,000 homes. But due to capital and resource restraints, they turned to PwC Australia for help.
"We proved the concept that the market wants an integrated offering, and helped the client by reducing delay. This integrated model can go across any aspect of the firm, not just infrastructure."
Over the next 12 months, the firm delivered a fully integrated advisory service across different professional capabilities including commercial and financial advisory, legal, tax, debt capital advisory, due diligence and financial model audit services. On top of this, PwC Australia and Reach agreed to share the entire project development risk, with payment to PwC wholly contingent on the project’s commercial and financial success.
PwC Australia and Reach worked together from inception to financial close across all aspects of the project, from securing land and development agreements to receiving equity commitments from world-renowned investors in the renewable energy sector.
“Quite simply, this transaction would not have been possible without the work delivered by PwC who have been with us from the start and shared the risk with us. More than 60 PwC employees across different business lines provided fully integrated specialist advice built on their knowledge of the energy sector and investment market.”
In April 2017 the team celebrated the successful financial close of the project with equity and debt financing to build the Bungala project coming from Italy’s Enel Green Power and the Netherlands' Infrastructure Fund.
Importantly, it is the first utility scale solar farm in Australia to be financed without government assistance, a milestone described by the Australian Financial Review as “compelling evidence that solar has reached a turning point in Australia.” The project will also make a large contribution to Australia’s commitment under the Paris Agreement to reduce greenhouse gas emissions.