Power
975 MW of Solar PV Projects Advance in South Africa
South Africa Minister for Mineral Resources and Energy Gwede Mantashe (left) and Scatec SA executive vice president for Sub-Saharan Africa, Jan Fourie, during the Dec. 8 signing of the agreements in South Africa.
Photo Courtesy Scatec
Six private renewable energy developers have each signed 20-year power purchase agreements with South Africa’s electricity public utility Eskom Holdings SOC Ltd for construction of 13 solar photovoltaic plants sited in Western Cape, Free State and Northern Cape provinces. The PV power plants will have a combined capacity of 975 MW.
The projects were approved for construction in October 2021 under South Africa’s Renewable Energy Independent Power Producer Procurement Programme, a competitive tender process designed to support private sector investment into grid-connected renewable energy generation. More than 6,000 MW of generating capacity has been allocated to bidders across a variety of technologies, principally in wind and solar.
On Dec. 8, the private developers, including Scatec SA, Engie-Pele consortium, Total Mulilo and IKAMVA consortium, also signed implementation agreements with South Africa’s Dept. of Mineral Resources and Energy with the projects’ commercial and financial close slated for the first half of 2023. Construction of the projects is expected to take two years. The plants are set to come online in early 2025.
Only one developer, Ikamva Consortium has confirmed the estimated cost of all its six projects while the other developers have yet to make public the value of their respective projects.
The Graspan solar PV project, to be built by the Engie-Pele consortium at Ritchie in the Northern Cape province, offers the lowest MWh tariff of ZAR 470.00 (US$ 27) while Scatec SA’s three projects of Grootfontein PV 1, 2 and 3 has the highest tariff at ZAR 484.60 (US$ 27.92).
“We are proud to have reached this milestone in the procurement process—and are excited to continue delivering clean and reliable energy in South Africa,” said Jan Fourie, Executive Vice President for Sub-Saharan Africa for Norwegian company Scatec SA, formerly Scatec Solar ASA.
Scatec’s three solar PV projects have a combined installed capacity of 273 MW spread over a land area of approximately 3 sq miles.
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Scatec said a statement it will own 51% of the equity in the projects, while its South Africa Black Economic Empowerment partner, H1 Holdings, will own 46.5%, and a local Community Trust will own the remaining 2.5%.
The Norwegian company will be the engineering, procurement and construction (EPC) provider and provide operation and maintenance, as well as asset management services to the facilities.
Multinational renewable energy company Mainstream Renewable Power and its Ikamva Consortium is constructing six of the 13 solar PV projects with installed capacity of 450 MW in South Africa’s Municipality of Tokologo, in the Free State, making it the biggest renewable energy developer in the province.
Mainstream Renewable Power says it is investing ZAR 9 billion (US$ 518.7 million) in the six solar PV project for the next 24 months and will create 1,800 jobs during construction as well avoid the release of approximately 1.3 million metric tons of carbon dioxide annually.
The Ikamva Consortium comprises Globeleq, Africa Rainbow Energy & Power, H1 Holdings, and local competitive tender process community trusts.
With the signing of the 13 power purchase agreements and implementation agreements, South Africa has secured 19 out of the 25 announced projects under the fifth round of the competitive tender process or Bid Window 5, which will add an overall total of 1,759 MW of renewable capacity to the national grid, made up of 784 MW from onshore wind technologies and 975 MW from solar photovoltaics. The 19 renewable energy projects are collectively worth ZAR 34.3 billion (US$ 518.7 million).
South Africa President Cyril Ramaphosa said on Nov. 19 that the country requires 140 GW to 300 GW of renewable energy for planned production of six to 13 million tons of green hydrogen and derivatives per year by 2050.
