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Scatec To Construct Three Kenhardt Solar PV Plants in South Africa

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growatt01-08-2022

Norway-based renewable power producer Scatec is set to start the construction of three solar projects in the Northern Cape province of South Africa. The IPP has closed the financing for these three solar power plants with battery storage facilities which will be developed in Kenhardt town.

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The projects are being implemented under the South African government initiative, Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP). Scatec is the first IPP to participate in this initiative.

The three projects (Kenhardt 1-3) will have a total capacity of 540 MW with a 225 MW/1,140 MWh lithium-ion battery storage system, making it arguably one of the largest single-site solars with storage hybrids in the world. The solar power plants will provide 150 MW of dispatchable power to the Kenhardt region under a 20-year power purchase agreement.

The expected implementation cost of the solar projects is nearly 16.4 billion South African Rand (~$962 million). The funding is provided by the project finance debt from a consortium of banks and development finance institutions. Within this estimated budget, ZAR 12.4 billion ($727 million) will be provided by a group of lenders including Standard Bank Group as arranger and British International Investment (BII).

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Under the co-development agreement, Scatec will own 51% of the equity in the project, while the Cape Town-based investment firm investor H1 Holdings will own 49%. Scatec is the EPC service provider for the construction of solar PV plants. The IPP will also look after the operation and maintenance of the plants along with its asset management services.

Terje Pilskog, CEO of Scatec, said, “Achieving commercial and financial close for the Kenhardt projects shows true commitment by our Scatec team and partners. This project is a first of its kind and will be one of the world’s largest solar and battery facilities.”

According to Jan Fourie, General Manager of Scatec Sub-Saharan Africa, the project is an important milestone in the procurement of clean energy in South Africa. It will take around 15 months to construct the solar plants and for the electricity produced to be fed into the national grid.

Scatec’s project will deliver predictable clean energy to the national grid at a significant scale and at a critical time. In March 2022, the IPP announced to refinance three of its operating solar power plants in South Africa. The three solar PV plants at Kalkbult, Dreunberg, and Linde have a combined capacity of 190 MW and operational since 2014.

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