ReneSola Ltd("ReneSola") (NYSE: SOL), a leading global manufacturer of solar photovoltaic ("PV") modules and wafers, announced that it has signed a toll manufacturing agreement with Solairedirect SA("Solairedirect"), a global pioneer of competitive solar power, to produce 120 megawatts ("MW") of solar modules in South Africa.
Under the terms of the agreement, Solairedirect will manufacture 120 MW of ReneSola-branded modules for a period of three years through its South African-based module manufacturing subsidiary, Solairedirect Technologies (Pty) Ltd. In addition, Solairedirect has committed to purchasing 20 MW of the solar modules for use in projects in South Africa and 34 MW of the solar modules for use internationally. Should Solairedirect expand its module production capacity, which it expects to double as early as sometime this year, it may produce additional solar modules for ReneSola under the current tolling agreement.
Mr. Xianshou Li, ReneSola's chief executive officer, said, "We have partnered with Solairedirect to benefit from its module manufacturing capacity and strong market presence in South Africa, as well as to secure low costs through the tolling agreement. As an example of Solairedirect's success in the country, its IPP business recently received preferred bidder status for two solar PV projects in South Africa by the South African Energy Minister Dipuo Peters, who named just 19 preferred bidders out of 79 total bidders in 2012. We are confident in Solairedirect's production capabilities and believe our solar modules, which generate high efficiency with very low sensitivity to variations in temperature, will be of value to solar projects in the region. We look forward to developing a long-term relationship with Solairedirect and will continue to seek opportunities to grow our business in the exciting South Africa market."
Mr. Ryan Hammond, managing director of Solairedirect's South-African based Independent Power Producer ("IPP") subsidiary, added, "As one of the leading solar IPP's in South Africa, we are committed to helping the government deliver solar PV projects that are cost competitive and deliver significant local content. We believe our successful bidding of two projects in the second round of the IPP Procurement Programme proves that this is possible. Our agreement with ReneSola paves the way for delivering projects that are cost competitive and exceed the Economic Development Department's criteria. Furthermore, this agreement will likely lead to the expansion of production capacity at Solairedirect Technologies, creating more jobs in the process. This move demonstrates yet again our continued commitment to invest in the South African solar industry, to create jobs and play a leading role in the growth of the industry."