Aurora Grid Renewables Business Plan › Section 9 › Funding Structure & Implementation Roadmap

9.1 Capital requirement and funding stack

The R48.5 billion programme is funded by a diversified stack blending
sponsor and strategic equity, infrastructure-fund and DFI capital, a
green-bond programme, and non-recourse project-finance debt. The
equity-weighted platform structure reflects the development-stage risk
profile, while individual projects are financed at the higher gearing
standard for South African renewables (BESIPPPP projects, for instance,
are typically financed at ~90% non-recourse debt). Potential funding
partners include the IFC, DBSA, IDC and AfDB.

9.2 Implementation roadmap

The programme runs over ten years, phased around grid access and
project financial closes rather than a fixed calendar. Critical-path
items are grid-connection applications (which gate generation and
revenue), the project financial closes, and the establishment of the
Aurora Grid Exchange trading platform. Capital recycling runs from Year
4 as the first projects stabilise.

9.3 Milestones and dependencies

9.4 Delivery discipline and capital recycling

Execution risk concentrates in grid access and the disciplined
execution of the capital-recycling model. The programme runs under
formal stage-gates — no generation project advances to construction
without secured grid connection and committed offtake — and the
capital-recycling engine is managed actively to fund growth without
proportionate new equity.

• Grid before capital. No major generation capital
  is committed without a secured connection path — the discipline that
  protects against stranded assets in a grid-constrained market;
  storage-heavy design eases connection.
• Recycle to grow. Stabilised projects are
  refinanced at the higher non-recourse gearing standard, releasing equity
  to fund the next phase — the engine that lets the platform reach 9 GW
  without proportionate new equity at each step.
• Ring-fence and green-label. Each project SPV
  carries its own non-recourse financing and completion support; the green
  bond is ring-fenced to eligible assets with independent use-of-proceeds
  verification.

9.5 Precedent transactions and financing comparables

The financing plan is anchored in recent, observable South African
renewable and storage precedents, which validate both the structures and
the appetite of the capital pools Aurora Grid targets.

Two lessons carry into the funding structure. First, South African
renewable and storage projects are routinely financed at high
non-recourse gearing (roughly 90% for BESIPPPP), which is the basis for
Aurora Grid’s capital-recycling thesis: stabilised projects can be
refinanced to release equity. Second, DFI and development-bank
participation (BII at Kenhardt; the IFC, DBSA, IDC and AfDB across the
market) is a recurring feature that de-risks and catalyses commercial
capital — which is why DFIs anchor Aurora Grid’s early-phase equity.

9.6 Capital-structure optimisation and green financing

The initial 59:41 equity-to-debt platform structure is deliberately
moderate for a development-stage business, but it is not the steady
state. As each generation and storage asset stabilises — reaching
commercial operation with contracted cash flows — its risk profile falls
sharply, supporting materially higher gearing. The Plan therefore
contemplates phased re-leveraging: refinancing stabilised assets toward
the ~90% non-recourse gearing that South African renewable and BESIPPPP
projects routinely achieve, releasing equity for redeployment or
distribution.

The green-bond dimension is central. As a pure-play clean-energy
platform, Aurora Grid can access the growing green- and
sustainability-linked bond market at a pricing benefit (a modest
“greenium”) and with a deep, mandate-driven investor base. Expanding
green-bond issuance as assets stabilise both lowers the blended cost of
capital and reinforces the ESG positioning that anchors the exit thesis.
Modelling the base case at moderate platform gearing is prudent and, if
anything, understates the equity return available through disciplined
re-leveraging and recycling — an upside the Plan flags for investors and
lenders to structure around.

9.7 Target investors and capital-raising strategy

The raise is sequenced to match investor mandates to risk phases.
Development and construction capital is anchored by sponsor, strategic
and DFI investors able to underwrite build risk; infrastructure and
pension funds enter as assets stabilise and the profile becomes
annuity-like; green-bond investors fund eligible renewable assets; and
senior lenders provide non-recourse project debt against contracted PPA
and availability revenue.

The DFI role is pivotal in the early phases: beyond capital, DFI
participation brings governance standards, blended-finance instruments
and a catalytic signalling effect that de-risks commercial and
infrastructure-fund capital. The platform’s climate impact — over 22 Mt
of CO₂ avoided annually — positions it strongly for this pool, bridging
the development-stage risk premium until contracted cash flows attract
lower-cost infrastructure and green-bond capital. The sponsor’s headline
returns are computed on a R20bn equity base; this Plan raises and
returns on the full R28.5bn stack, a more complete basis that investors
should note when comparing to the sponsor’s 8.1x.

Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of Aurora Grid Renewables Holdings (Pty) Ltd.