Another big solar contractor has hit the wall in the Australian solar industry, with R&L Solar Constructions – a company operating in some of the country’s best known projects – placed in voluntary administration on Monday.
A notice filed with the Australian Securities Investment Commission on Tuesday says that Andrew Yeo and Gess Rambaldi from insolvency specialists Pitcher Partners have been appointed as administrators of R&L Constructions and associated entities with a creditors meeting to be held next week.
R&L, a subsidiary of a Japanese company, is the latest in a string of failures that has seen the country’s biggest solar EPC contractor RCR Tomlinson collapse, and many others such as Downer withdraw completely or partially from the industry because of fierce competition, cost over-runs, and disputes over damages due to delays and complications from new connection rules.
Among those to leave the industry are Downer and Ellaktor, with others such as Decmil choosing to take on less risky “balance of plant” projects.
A number of smaller sub-contractors have also failed, and R&L is the latest of these. It is not clear what precipitated the collapse of R&L Solar Construction as it is not a full EPC contractor and it focuses on installation of solar panels, pilings and cleaning services, although it has blamed the non-payment of invoices and an unspecific “fraud”.
Among the projects it has been working on are the 60MW Christmas Creek solar project in the Pilbara, which is being built by Alinta Energy to provide power to iron ore mines run by billionaire Andrew Forrest’s Fortescue Mines, the 50MW Jemalong solar project in NSW being built by Genex, and the new 12MW solar farm being built for the Melbourne Airport.
Other solar farms it is currently working on are the huge Wellington solar project in NSW, Corowa in NSW, the Collinsville solar project in Queensland and Kiamal in Victoria.
Victoria’s biggest solar farm, the 256MW facility at Kiamal, has been hit by problems, including the withdrawal of Biosar, the subsidiary of Ellaktor, and its replacement by other contractors including Beon Energy Solutions. R&L also worked on the Karadoc and Cohuna solar projects. Two project developers spoken to by RenewEconomy say R&L it was highly regarded.
In a letter to employees that has been shared on social media, CEO Uwe Rosenkrantz blamed the decision on a “third party fraud” from an unspecified company, and the failure of many companies, including Sterling and Wilson, to pay invoices. “This has resulted in the inability to continue to operate,” he said. Sterling and Wilson have been approached for comment.
Another post on social media says that employees at the Christmas Creek solar project had not been paid for five weeks. “We have to wait in the camp and nobody help us,” the worker said.
Pitcher Partners said the creditor situation would not be clear until a meeting next week, but it was already apparent that the Australian Tax Office was the biggest creditor with $2 million owing.
Yeo said in a statement there was no money to keep the approximately 250 staff, mostly casual labourers. All had been notified on Tuesday that their positions were terminated. It is understood this created significant issues in remote locations, such as the Pilbara solar project.
“We and the directors are in conversation with various contractors and project owners in an attempt to try to transition employees wherever possible.” Yeo said.
“This is going to cause some people disruption or hardship as some employees and subcontractors are working in very remote and regional areas, so we are doing what we can to find them some alternative options.”
Update: Sterling & Wilson said in a later emailed statement: We wish to clarify that there was no overdue payment from Sterling and Wilson Solar Australia Pty Ltd at the time of filing of bankruptcy by R&L Solar Constructions. We are in touch with administrator of R&L Solar and are seeking clarity for way forward. As a responsible corporate citizen, we follow and will continue to follow all necessary legal protocols in this matter.
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