EDF Renewables Achieves Legal Close Of South African Solar And Wind Project

3 minute(s) Read

September 6, 2023

ESG Review Staff

In 2019, EDF Renewables announced the commissioning of Bluemex, its very first solar power plant in Mexico. This 119.6-MW photovoltaic facility is located in the northern Mexican state of Sonora. (Image Courtesy Of EDF Renewables)

EDF Renewables achieved legal close on its South African Umoyilanga project with the signing of a power purchase agreement (PPA) with Eskom and the implementation agreement with the Department of Mineral Resources and Energy for the hybrid renewable power facility to be built in South Africa.

Legal close follows in the wake of the consortium of international renewable energy supplier, EDF Renewables, and privately held investment company Perpetua Holdings (Pty) Ltd, winning the Umoyilanga project bid in the South African Government’s Risk Mitigation IPP Procurement Programme (RMI4P), in March 2021. Financial close is expected to be achieved by the second half of October 2023. The construction period under the PPA is expected to start immediately thereafter, with commercial operations expected to begin in May 2025.

The project combines solar, wind, and battery storage technologies to offer dispatchable power to the national electrical grid. The project will operate as a virtual power plant, combining generation from two sites which are 559 miles (900 km) apart, namely Avondale in the Northern Cape, with 115 MW of solar and 30 MW of battery storage, and Dassiesridge in the Eastern Cape, with 63 MW of wind and 45 MW of battery storage.

Following the signature of the PPA with Eskom for the Umoyilanga project, EDF Renewables also signed a turnkey engineering, procurement, and construction agreement with China Energy Engineering Corporation (CEEC), to proceed with the final design, procurement, and construction of the 115-MW Avondale solar plant.

The unique combination of wind and solar resources with batteries enables Umoyilanga to provide 75 MW on demand from 5:00 AM to 9:30 PM as per the requirements of the PPA, and demonstrates that renewable energy can provide reliable, dispatchable power at a competitive price. To achieve this, batteries at Dassiesridge will generally charge from the wind energy at night, discharging power in the morning until the sun rises. The solar installation at Avondale will supply the bulk of the energy during the day, supplemented by wind energy from Dassiesridge. Excess solar energy will be used to charge the batteries at Avondale, which will discharge after sunset. A sophisticated energy management system will give instructions to assets across both sites to optimize the power supply in real time, depending on weather forecasts and Eskom’s requirements. The low-carbon electricity produced will help to meet the electricity needs of 120,000 households for 20 years, based on the Eskom residential consumption average of 3319 kWh/household.

The project has committed to providing around 450 fulltime jobs to local South African citizens during the construction period and to contributing approximately 40% of the capital expenditure to local content (procurement of South African goods and services). Over the 20-year operational period, 1.2% of revenue will be dedicated to local communities through socioeconomic initiatives.

“The signing of the PPA with Eskom is a crucial milestone before financial close and the launch of the construction phase,” said Tristan de Drouas, chief executive officer of EDF Renewables in South Africa. “Our teams in Gqeberha and Cape Town have been working very hard, so today’s legal closing is the achievement of a long journey. We look forward to realizing this project in South Africa, supporting the ambitions of the government to develop low-carbon energy solutions for the future, and to help solve the loadshedding crisis. Just a few days after the BRICS’ Summit, we’re delighted to say that we are present in most of the organization member states, namely in Brazil [1.5 GW], India [1.2 GW], China [1.3 GW], and South Africa [425 MW], bringing our expertise for facing their energy transition needs.”

“We have forged a solid collaboration and true sense of partnership with EDF Renewables on this project and we are excited by the innovative and high-impact contribution we are collectively confident it will deliver to South Africa,” said Logan Govender, director of Perpetua Holdings.