ACWA Power Inks Power Purchase Agreement for South Africa’s Largest Hybrid Renewable Energy Venture

Saudi-listed ACWA Power, known as the world’s largest private water desalination company and a front-runner in energy transition, has signed the Power Purchase Agreement (PPA) for the “ACWA Power Project DAO.” This initiative, a 150MW dispatchable renewable hybrid plant, marks a significant step in South Africa’s renewable energy landscape.

The signing ceremony witnessed the participation of key figures including the Honourable Gwede Mantashe, Minister of Mineral Resources and Energy, signing the Implementation Agreement, and Mr. Segomoco Scheppers from Eskom sealing the Power Purchase Agreement alongside ACWA Power Project DAO signatory Mr. Ashley Singh. This project secured its place as one of the preferred bidders in the Risk Mitigation IPP Procurement Program in 2021, boasting the lowest tariff.

Nestled in South Africa’s Northern Cape Province, the venture will house the country’s largest solar PV installation, boasting a 442 MW capacity, and approximately 1,200 MWh of battery storage—among the world’s largest. Operations are slated to commence by Q2 2026, augmenting the grid’s dispatchable capacity significantly.

Project DAO extends its impact beyond energy generation, encompassing a substantial scope for transmission integration. This includes upgrades to Transmission Substation capacity and a new distribution station. These additions are poised to grant access to the grid for other renewable projects in the region while addressing Northern Cape grid congestion.

Marco Arcelli, Chief Executive Officer of ACWA Power, underscored the company’s commitment to advancing energy transition in burgeoning markets. He expressed pride in contributing to South Africa’s socio-economic development by delivering power, desalinated water, and green hydrogen reliably and affordably.

With an estimated cost of around USD 800 million, Project DAO stands as one of South Africa’s most substantial hybrid investments in renewable energy, currently under construction. The project’s investor consortium includes ACWA Power, Thebe Investment Corporation Pty Ltd., and Aventro Investments Pty Ltd., all with significant involvement in renewable energy endeavors.

Beyond supplying clean energy to the national grid, the project is set to invigorate South Africa’s socio-economic framework. It plans to reach approximately 50% local content in procurement during construction, generating over 1,000 construction jobs at its peak, with a significant portion coming from the local community.