Scatec signs PPAs for 273MW of South African solar projects

Scatec, the Norwegian independent power producer (IPP), has signed 273MW of power purchase agreements (PPAs) for solar projects in South Africa under the government’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).

The PPAs are for three projects in Grootfontein, in the Western Cape province of the country, and constitute a 20-year agreement with South African energy company Eskom. Financial and commercial close on the agreements is expected in H1 2023.

“We are proud to have reached this milestone in the procurement process – and are excited to continue delivering clean and reliable energy in South Africa,” said Scatec executive vice president for Sub-Saharan Africa, Jan Fourie.

“The South African government has shown strong commitment to deliver in challenging times – and today’s achievement is a testament to the hard work and dedication of actors in the country’s renewable energy transition.”

In November, Scatec announced plans to invest US$950 million in renewables development by 2027, aiming to add 1.5GW of capacity per year. June saw the company sign a further 540MW of PPAs in South Africa.

In July this year, South Africa revealed a series of measures intended to bolster its renewables deployment in the face of the global energy crisis. Last month, during the COP27 conference, the European Investment Bank launched a tandem operation with the Development Bank of South Africa to support US$413 million worth of investments into the country’s renewable energy sector.

Scatec will have a 51% stake in the Grootfontein projects whilst H1 holdings, the company’s Black Economic Empowerment partner, will own 46.5%. A community trust will hold the remaining 2.5% equity. Scatec will also handle engineering, procurement and construction as well as operations and maintenance.

In October, Eskom signed agreements with four IPPs to add 2GW to its renewables capacity.