Construction of the Redstone Concentrated Solar Plant (CSP) in the Northern Cape province has commenced.
This was announced by ACWA Power, a Saudi developer, investor and operator of power generation and water desalination plants in 13 countries and the lead shareholder in the Redstone CSP.
ACWA Power made the announcement of commencement of the construction on the 100MW Redstone project following achievement of financial close.
According to the company, at R11.6 billion total investment, the Redstone project is the largest renewable energy investment in SA to date.
The project has secured financing from leading international and South African financial institutions, including African Development Bank, Absa Bank, Development Bank of Southern Africa, CDC Group, Nedbank, Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden, Deutsche Investitions-und Entwicklungsgesellschaft, Investec and Sanlam.
The construction of the Redstone CSP comes after the South African government recently opened the much-awaited Bid Window 5 of the Renewable Energy Independent Power Producers Procurement Programme, which will procure a further 2 600MW of renewable energy from independent power producers.
The energy department expects the new bid window to unlock R45 billion worth of renewable energy investments in the South African economy.
ACWA notes that through the successful mobilisation of international project finance, Redstone CSP has facilitated approximately R7 billion in foreign direct investment to fund and support the country’s strategic energy transition goals.
The company’s co-shareholders in the project include the Central Energy Fund, Pele Green Energy and the local community.
Located in the Northern Cape province of SA, the Redstone plant will be equipped with a 12-hour thermal storage system that will deliver clean and reliable electricity to nearly 200 000 households round the clock.
Commencement of operations is scheduled for Q4 2023.
Says Paddy Padmanathan, president and CEO of ACWA Power: “ACWA Power is proud to lead the energy transition in countries that are committed to ambitious renewable energy targets to support economic growth and social development.
“Redstone CSP adds another superlative to our budding record in South Africa, being the largest renewable energy investment to date. As grid links are improved, the ingenuity of the private sector together with the great support of experienced finance partners has the potential to spark lasting impact for local communities and address the threats of climate change.”
Rajit Nanda, chief portfolio management officer and acting chief investment officer of ACWA Power, comments: “We are proud to play a key role in supporting South Africa’s decarbonisation efforts, and are grateful to our partners for contributing to our mission to reliably and responsibly deliver power and desalinated water at an affordable cost.
“Following in the footsteps of the record-breaking Bokpoort CSP and deploying the same thermal salt storage system, Redstone CSP is set to be yet another ACWA Power flagship project in South Africa that directly benefits households in the area with remarkable plant performance.”
The Saudi-based company points out that Redstone CSP will displace an estimated 440 metric tonnes of CO2 emissions per year.
It adds that the project is certified under the Climate Bonds Standard and Certification Scheme and aligned with the goals of the Paris Climate Agreement, which seeks to limit global warming to under two degrees Celsius.
In addition to efficiently delivering clean energy to the national grid, the Redstone project will offer tangible socio-economic value through offering job opportunities and utilising local supply chains, the company says.
According to the firm, the project will reach close to 44% local content on procurement during the construction period; create more than 2 000 construction jobs at peak, with about 400 from the local community; and create approximately 100 permanent direct jobs during the operating period.
As part of its implicit social contract, ACWA says Redstone CSP will provide value-adding ancillary services required by the system operator at no cost to the local public utility Eskom, which marks a first for a renewable energy plant in the country.
Share