Solar project gets first R2.3bn tranche
The Redstone concentrated solar power (CSP) project, the largest renewable energy investment in South Africa, is on course for completion in the fourth quarter of next year after the consortium this week accessed R2.3-billion of the R11.6-billion credit facility it secured.
The first debt drawdown came from the African Development Bank (AFDB).
The project is led by Saudi Arabia’s Acwa Power, with the Central Energy Fund and Pele Green Energy as partners.
Pele, a 100% black-owned independent power producer, develops, owns, procures and manages renewable energy projects.
The project also secured financing from leading international and local financial institutions including Absa, Development Bank of Southern Africa, Nedbank, Investec Bank and Sanlam. The Northern Cape project is expected to be equipped with a 12-hour thermal storage system that will deliver clean and reliable electricity to nearly 200,000 households around the clock.
AFDB vice-president in charge of power, energy, climate change and green growth Kevin Kariuki said Redstone CSP would offset an estimated 440 tonnes of CO2 emissions per year while also providing value-adding ancillary services to Eskom.
“The project will reach close to 44% local content on procurement during the construction period; create more than 2,000 construction jobs at peak, with about 400 from the local community; and create approximately 100 permanent direct jobs.”
AFDB director for energy financial solutions and policy regulations Wale Shonibare said: “This project marks a landmark project finance investment in South Africa and demonstrates the commercial viability of CSP technology in enhancing clean energy generation. ”
President Cyril Ramaphosa used his state of the nation address to reassure markets of his administration’s commitment to a just transition “to a sustainable, inclusive, resilient and low-carbon economy”.
He also appointed Daniel Mminele, the former deputy governor of the Reserve Bank, as head of the Presidential Climate Finance Task Team to lead the mobilisation of funds.
South Africa got commitments to the tune of R131-billion from the US, UK, Germany and the European Union to help the country’s transition from coal to clean energy.
The commitment were made at the Climate Change Conference of the Parties (COP) 26 held in Glasgow, Scotland, four months ago.
Minerals Council CEO Roger Baxter said the member companies “have a pipeline of 3,900MW of potential renewable energy projects worth more than R60-billion that would, when implemented, substantially contribute to bridging the large electricity supply deficit, diversify the country’s supply, reduce the sector’s carbon footprint and stabilise costs”.