ENGIE announced that it has reached an agreement to acquire from Abengoa a 40% equity stake in Xina Solar One, a 100MW concentrated solar plant (CSP), as well as 46% of the Operations & Maintenance company.
The plant is equipped with parabolic trough technology and a molten salt storage system that allows for 5.5 hours of energy storage to provide reliable electricity during peak demand. Power is contracted through a 20 years Power Purchase Agreement with South Africa’s electricity public utility, Eskom.
Xina Solar One is supplying clean energy to more than 95,000 South African households and prevents the emission into the atmosphere of approximately 348,000 tons of CO2 each year.
The plant is located in the Northern Cape of South Africa, which is also the location of ENGIE’s 100MW Kathu CSP plant.
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“With the acquisition of this project, ENGIE is pursuing its low carbon strategy. Xina augments the country’s installed peaking power and reduces its dependence on coal-fired electricity. The 100MW CSP plant also contributes to ENGIE’s geographic rationalisation by expanding its footprint in South Africa, where it is the leading Independent Power Producer with 1,320MW of installed capacity,” says Sébastien Arbola, CEO of ENGIE MESCATA.
Mohamed Hoosen, CEO of ENGIE Southern Africa: “ENGIE is valued as a highly skilled IPP and a long-term player in the South African power industry. We are adding an innovative high-performing plant and are increasing our CSP capacity. This investment will create value over the longer term while accelerating impact on the energy transition of our customers.”
Co-shareholders on Xina Solar One include Public Investment Corporation, a pension fund manager and a shareholder on ENGIE’s Kathu project (20%); Industrial Development Corporation, a development finance institution wholly- owned by the South African Government (20%); and Xina Community Trust, funded by the IDC (20%). Xina Solar One, which started commercial operation in August 2017, was built by Abengoa.
Completion of the transaction is subject to the fulfillment of certain conditions including merger control clearance from relevant competition authorities.