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Scatec Solar inks agreement with South Africa to launch $388m solar projects

28 May 2013

Norway-based solar energy company Scatec Solar has inked an agreement with Department of Energy to develop two solar projects with an investment of $388m in South Africa.

The two projects, at Linde in the Northern Cape and at Dreunberg in the Eastern Cape, are estimated to add 115MW electric power to the country's national grid.

The projects were awarded as a part of $2.9bn worth second round of Renewable Energy Independent Power Producer (REIPP) programme.

During the second round, the government is looking to add 1GW of renewable energy to its capacity through 19 projects.

Scatec, meanwhile, claimed that it is likely to conclude the development of 75MW Kalkbult project in the Northern Cape in October 2013, two months ahead of schedule.

The project was secured during the first round of programme.

Scatec Solar chief executive Raymond Carlsen said that the company is keen to develop additional PV projects as a part of country's renewable energy program, besides adding that the company is better prepared to face challenges for these projects after having gained experience during the construction of Kalkbult project.

"We have for more than three years been actively developing project opportunities in South Africa, and being able to realise our plans is of great satisfaction to us and will benefit both the regions and the local communities in which we operate," Carlsen noted.

Scatec has secured the investment of $390m from Standard bank, while obtaining power purchase agreement with Eskom.

Overall, the plants are expected to produce a total of 225 million KWh per annum, which is enough to cover the electricity demand of 53,000 households.