Scatec was named as one of the preferred bidders under the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPP) as announced by the South African Department of Mineral Resources and Energy (DMRE).
The three projects totalling 150MW (3x50MW) of contracted capacity will fall within the range of the previously awarded preferred bidders.
The three projects (Kenhardt 1-3), in total consisting of 540MW solar and 225MW/1,140MWh battery storage, were bid based on sites located in the Northern Cape Province of South Africa.
The projects awarded to Scatec are the only projects with preferred bidders status exclusivity making use of renewable energy technology, making it arguably one of the largest single-site solar and storage hybrids in the world.
The solar and storage solution will provide dispatchable power from 5:00 am in the morning to 21:30 at night and will deliver much-needed power to the South African economy. The power will be sold under a 20-year Power Purchase Agreement with a paid capacity charge.
Financing has already been sourced as part of the bidding process. Project capex is estimated to be $1 billion and will be funded by project finance debt from a consortium of commercial banks and Development Finance Institutions with expected debt leverage of 80%.
Scatec will own 51 % of the equity in the project with H1 Holdings, their Black Economic Empowerment partner owning 49%. Scatec will be the engineering, procurement and construction (EPC) provider and provide operation and maintenance as well as asset management services to the power plants.
Financial close is expected later in 2021 with grid connection by the end of 2022.
Scatec CEO Raymond Carlsen. said: “This is truly a great milestone for renewable energy. We are demonstrating that cost-competitive dispatchable solar power can be delivered at large scale with short implementation time.”