Eskom brings IPPs into the mix

ESKOM has partnered with independent power producers in a bid to address the energy crisis.

It signed land lease agreements with five independent power generators at two of its stations in Mpumalanga for the construction of new energy generation capacity.

The investors will lease 6 184 hectares of land for between 25 and 30 years each, and potentially ontribute about 2 000MW to the national power grid.

The embattled power utility also plans to make more land available around its power stations where there is sufficient grid capacity to connect energy producers.

The successful bidders are HDF Energy South Africa, Red Rocket SA, Sola Group and South Africa Mainstream Renewable Power Developments.

Eskom has also concluded power purchase agreements with third parties, and the power will be distributed through Eskom’s infrastructure, helping to alleviate generation capacity constraints.

Eskom said the key objective of the initiative was to provide relief to the constrained electricity system in as short a time as possible. There is a dire need to alleviate pressure on the system by adding as many megawatts as possible in the shortest possible time, thus increasing Eskom’s ability to conduct maintenance of its existing fleet, reducing load shedding and the usage of open-cycle gas turbines.

This agreement involves land parcels around the Majuba and Tutuka stations. The next phase will focus on properties around the Kendal and Kusile stations in Mpumalanga, as well as the retired Ingagane station in Newcastle, KwaZulu-Natal.

It is expected the generators will be connected to the grid within 36 to 48 months from financial closure.

Matteo Brambilla, CEO of successful bidder Red Rocket Energy, said their success in the industry spoke for itself.

“We are excited and geared to support Eskom through adding new generation capacity,” he said.

“Red Rocket will develop its project in solar and incorporate a storage component but, ultimately, the bidders combined are supporting Eskom. While the project is in Mpumalanga, communities across South Africa stand to benefit from the initiative with more power ultimately being added to the grid,” Brambilla said.

Head of development at Red Rocket Energy, Sharief Harris, said: “Feasibility studies commenced with the launch of the Eskom procurement process, and this approach allowed us to put in proposals to Eskom that we believed would be acceptable to Eskom and sustainable”