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Norway’s Scatec to invest R1bn in SA’s solar project

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Norwegian-based renewable energy power producer Scatec will invest over R1 billion in the renewable energy project in SA.

The company has announced the awarding of its bids to supply SA with 150 megawatts of dispatchable power through the use of renewable energy.

This, as SA witnesses a flurry of activity in renewable energy investments. Last month, construction of the R11.6 billion Redstone Concentrated Solar Plant in the Northern Cape province commenced.

In the same month, the 123MW Golden Valley Wind Energy Facility reached commercial operations and is expected to generate over 477GWh of renewable power each year, equivalent to the energy needs of approximately 120 000 households.

Minister of mineral resources and energy Gwede Mantashe unlocked R45 billion in renewable energy investments when he finally announced the much-awaited opening of Bid Window 5 of the Renewable Energy Independent Power Producers Procurement Programme, which will procure a further 2 600MW of renewable energy from independent power producers.

In a statement, Scatec says its bid has been awarded as part of the national Risk Mitigation Independent Power Procurement Plan (RMIPPP) by the Department of Mineral Resources and Energy.

It notes this represents government’s response to the current energy crisis, in which power shortfalls have threatened to bring the country’s economy to its knees.

Load-shedding woes

The announcement comes as power utility Eskom is currently implementing load-shedding. This week, the state-owned company, which provides about 95% of SA’s power needs, informed the public that stage two load-shedding will be implemented starting at 10am on Wednesday until 10pm on Friday.

However, the South African government is making progress in driving renewable energy as the country tries to move away from fossil fuels.

When he tabled the department’s budget vote during a mini plenary of the National Assembly last month, Mantashe said renewable energy has played a critical role in ensuring troubled power utility Eskom deals with its energy capacity shortages.

Scatec notes that unlike its predecessors, the RMIPPP is a progressive, energy-agnostic scheme and therefore not prescriptive when it comes to power generation technology, but rather focused on technical outputs, driven by power system requirements.

On that basis, it says, Scatec opted to present solar plus battery only bids – going toe-to-toe with fossil fuels and other hybrid configurations.

The company says it should be noted that the Scatec bids are the only renewable energy only bids awarded in this tender process – showcasing it at the forefront of future-oriented power delivery in South Africa and globally.

It points out this aligns with government’s 2019 Integrated Resource Plan – a document which articulates SA’s envisioned transition to a cleaner, mixed energy supply, with greater emphasis on renewable power.

Jan Fourie, Scatec general manager for Sub-Saharan Africa, states the project site will house over two million individual solar panels, reach roughly 10km from end to end and will require a total capital expenditure of around $1 billion.

“To our knowledge, this may well be the world’s largest solar and battery storage hybrid plant,” he adds.

The initiative will consist of solar arrays totalling 540MWp, all situated at the same site in the sunny Northern Cape.

Each project will be capable of generating 50 megawatts of dispatchable power (or contracted capacity, in RMIPPPP terms) and will be co-located with cutting-edge energy storage technology plants using lithium-ion batteries, in aggregate having a capacity of 1.1 gigawatt hours, allowing for an unprecedented level of output control and dispatchability.

The site has been overly capacitated to generate agreed-upon power even in the lowest performing solar months – with 22 years of hourly historical data being studied to ensure optimal performance.

Together, they will meet the requirement to be dispatchable, according to market needs, and be fully dispatchable daily from 5am to 9.30pm, says Scatec.

“Totalling an impressive output capacity of 150 megawatts of clean, dispatchable power, the projects will play a major role in closing the energy gap in South Africa and mitigating the threat of continued load-shedding in coming years. These bids will also contribute large amounts of skilled and unskilled jobs to the South African economy during the construction phase, and generate substantial long-term employment going forward,” says Fourie.

Global player

Scatec, which is present on four continents and headquartered in Norway, has global experience in a diverse range of renewable power generation projects, having been active in the South African market since 2010.

From its local offices in Cape Town, the group operates and manages a portfolio of six utility-scale solar PV sites and operations, including the Kalkbult plant in the Northern Cape (the first utility-scale solar plant in SA), as well as the recently completed 258MW Upington Solar Complex.

“We are proud to be the country’s leading supplier of solar power, with an array of plants and projects totalling 448 megawatts of renewable energy,” says Fourie.

According to Scatec, the call for bids attracted power industry heavyweights that will collectively supply a total of 2 gigawatts of electricity by July 2022, in order to reduce the impact of load-shedding on the national economy in a timeous manner.

Fourie believes the bid comes at a crucial time in the energy-landscape, when renewables are poised to become more cost-effective than ever before, and in which many global fossil-fuel giants are now pivoting their efforts and resources towards renewables.

“Our work demonstrates a commitment to a brighter, greener future globally, and stands as an important testament to the fact that renewables are now fully dispatchable and can compete in the market against traditional, less sustainable energy resources,” Fourie says.

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