Africa-Press – South-Africa. Two wind projects are the first under Bid Window 5 of the Renewable Energy Independent Power Producer Procurement programme (REIPPPP) to reach financial close.
The projects are to be developed by EDF Renewables, a subsidiary of EDF Renouvelables, the renewable energy arm of global utility EDF.
Three of EDF’s 140 MW wind projects were named successful bidders. But only its Phezukomoya and San Kraal wind energy plants, to be located in the Northern Cape, have reached financial close so far. The transaction is valued at R7.7 billion, according to a statement from Absa, which acted as a lead arranger for the two projects.
“This step represents the first wind energy deals to reach conclusion since Round 4 of the REIPPP in 2018,” EDF Renewables said in a statement.
The third wind project, Coleskop, which will be located in the Eastern Cape, is expected to reach a financial close before the end of January 2023, bringing the total capital cost to R11.5 billion.
“The low-carbon renewable electricity produced each year by the three wind farms will help to meet the electricity needs of approximately 193 000 South African households,” EDF Renewables said.
South Africa is currently gripped in an energy crisis, having experienced over 100 days of load shedding in the past 10 months. The biggest issue is a lack of sufficient generation capacity, which is why the rollout of renewables under the REIPPPP is so important.
“The REIPP programme is critical in helping Eskom to add renewable power generation capacity to the grid in line with the country’s energy transition objectives and sustainable development goals,” said Absa’s Shaun Moodley, principal within the bank’s resource and project finance team.
Each project comprises 26 wind turbines, which are as high as 124 metres (the length of two-and-a-half Olympic swimming pools), and have a blade length of 83 metres (or roughly the breadth of a soccer field).
EDF Renewables will also be constructing a transmission substation, which will be handed over to Eskom upon completion.
The projects have entered into a 20-year Power Purchase Agreement with Eskom, which means they will sell electricity to the power utility.
“Our next objective now becomes to construct these wind farms, safely, and on time, to be able to deliver this much-needed power into the National Grid before November 2024,” said EDF Renewables in South Africa CEO, Tristan de Drouas.
The construction is expected to create 400 full-time jobs for two years and 35 full-time jobs during its operation for 20 years.
About 40% of the project will include local content, and during its operation, and 1.2% of revenue will go toward socioeconomic development programmes to benefit local communities.
The Black Economic Empowerment partners to the project are H1 Holdings and GIBB-Crede, and a local community trust.
For More News And Analysis About South-Africa Follow Africa-Press
