Scatec has reached a new milestone in the development of its Grootfontein solar power plants in South Africa. The Norwegian Independent Power Producer (IPP) has secured the necessary financing to launch the works, which are scheduled for the first quarter of 2024. Scatec is financing its three solar power plants through a 4.5 billion South African rand ($241 million) non-recourse debt facility provided by Standard Bank of South Africa, which is acting as mandated lead arranger.
Developer Scatec is providing the remaining $270 million required to complete the concessions, which were awarded under the 5th Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) tender window. The IPP will hold a 51% stake. The remaining shares are held by the South African investment company H1 Holdings (46.5%) and the Grootfontein Local Community Trust (2.5%).
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Scatec will provide engineering, procurement and construction (EPC) services for Grootfontein’s solar photovoltaic plants. “South Africa is a priority market and this value-added investment, with returns above our break-even point, is in line with our strategy of profitable growth and expansion in sub-Saharan Africa. We look forward to starting construction next year and reaching commercial operation in 2025, while powering around 100,000 homes in the region,” says Terje Pilskog, Scatec’s CEO.
The electricity generated in the Western Cape will be fed into the state-owned utility Eskom’s grid under a 20-year power purchase agreement (PPA). Scatec estimates that its three solar power plants will reduce CO2 emissions by a combined 630,000 tonnes a year.
Jean Marie Takouleu