Share

Energy dept approves 100MW solar plant

Cape Town - The department of energy on Thursday gave the go-ahead for SolarReserve and Saudi Arabia’s ACWA Power to build a 100MW solar power plant.

Acceptance of the bid means the companies can now proceed to financial close, expected this year, and the signing of a power-purchase agreement with state-owned utility Eskom.

The Redstone plant, near Kimberley, is expected to start working in early 2018, California-based SolarReserve said on Thursday in a statement on its website.

“South Africa now has 700MW of solar thermal projects in various stages of development and at this rate will have the third-largest installed capacity by 2020 after Spain and the US based on current developments,” Derek Campbell, a Bloomberg new energy finance analyst, said by e-mail.

In comparison, coal power plants generate between 1000MW and 4000MW.

Bidding process

The companies’ offer was accepted under the nation’s Renewable Energy Independent Power Producer Procurement Programme that requires applicants to bid on the level of tariff, as well as value to the local and national economy.

“Redstone is now the cheapest in terms of tariff for solar thermal in South Africa at a cost of $124 [R1450] a megawatt-hour and the overall project cost is also on the low side at $715m [R8.36bn],” Campbell said.

The plant will include a thermal energy-storage system to help balance peaks between supply and demand. That means it will provide “dispatchable power on-demand,” similar to a conventional coal, oil, nuclear or natural gas-fired power plant, without the emissions and fuel cost, SolarReserve Chief executive officer Kevin Smith said.

The facility will create more than 800 jobs during construction, according to the statement. It’s expected to generate more than R6bn of income tax over its first 20 years of operation.

GDF Suez SA on January 6 was invited by the Department of Energy to enter into a 20-year power-purchase agreement for a 100-megawatt concentrated solar farm with Eskom.

South Africa's power grid is under "significant pressure" at the moment as the continent's most advanced economy reboots after the festive season and the reserve margins are expected to be "very tight" next week, Eskom spokesperson Andrew Etzinger said.

Read: Blackout risk high, Eskom warns


We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.89
+0.3%
Rand - Pound
23.87
+0.1%
Rand - Euro
20.38
+0.2%
Rand - Aus dollar
12.32
+0.1%
Rand - Yen
0.12
+0.2%
Platinum
908.05
0.0%
Palladium
1,014.94
0.0%
Gold
2,232.75
-0.0%
Silver
24.95
-0.1%
Brent Crude
87.00
+1.8%
Top 40
68,346
0.0%
All Share
74,536
0.0%
Resource 10
57,251
0.0%
Industrial 25
103,936
0.0%
Financial 15
16,502
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders