What are the electricity generating opportunities available for a new entrant in Africa's rapidly expanding energy market?
The new entrant Cennergi has opportunities to put up all types of generating capacities especially thermal, hydro, wind and solar and even geothermal in topography that is favourable. Incidentally, Africa is blessed with good opportunities in each of these as input resources are abundant.

What are the advantages of partnering with local entities while pursuing growth opportunities in potential markets?
The strategic partnership with a local entity is extremely relevant for entering new markets. It helps in gaining the right understanding and perspective of local cultures and markets, in pursuing opportunities in a manner that’s benign for the geography, as well as attracting the right talent.

We started a structured process in August 2010 (when we set up a formal presence in South Africa) to find a local partner. In the case of Cennergi, we have partnered with Exxaro, which is one of the largest diversified resources companies operating in South Africa. They bring with them a wealth of experience in the energy market in that country. They are the largest supplier of thermal coal to the local utility and have access to substantial thermal coal resources, gas blocks and coal bed methane tenements across southern Africa.

Exxaro is hence an ideal partner for Tata Power to be a relevant and substantial player in the African electricity market. The partnership will ensure that Cennergi possesses the skill set, track record and experience to become a successful South African power company.

Will Cennergi carry out the joint stakeholder Exxaro’s proposed projects, or will it conceive new ones?
Cennergi is a 50:50 joint venture (JV) where the shareholders have joint control. As such Cennergi shall develop projects by mutual agreement of the shareholders which will include existing as well as new projects. Cennergi will recruit suitably qualified and experienced individuals, both internally from the shareholders and externally as required.

The company will be working to develop new projects along with those that were being developed by Exxaro prior to the formation of the JV company.

What are the potential challenges facing Cennergi?
Cennergi aims to be the leading clean energy Independent Power Producer (IPP) in southern Africa. One of the key challenges is to win the bids for some of the renewable projects that it is targeting.

Will the new entity, now concentrating on renewable energy like wind, and solar energy, graduate to other energy sources such as thermal power in the future?
The initial project pipeline will focus on renewable energy projects in southern Africa. Moving forward, Cennergi’s strategy is to create a balanced portfolio of generation assets including thermal and other projects as and when the opportunity arises.

What other sustainable projects are on the anvil? Can you elaborate on the benefits that this joint venture will bring to the region and local communities?
At present the JV is focused on a portfolio of renewable energy projects, however the ambit of the company is to also develop fossil fuel-based and other projects as and when the opportunity presents itself.