23 April 2010 – A memorandum of understanding has been signed at Wittekleibosch, in the Eastern Cape, between partners hoping to develop the Tsitsikamma Community Wind Farm (TCWF) project, which aims at generating 40 MW of wind power by 2013, and will be worth about R1-billion.

The TCWF consortium consists of a number of key partners – the Tsitsikamma Development Trust, which operates on behalf of the community that owns the land, South African energy company Watt Energy and mining company Exxaro, which, together, hold a 46% stake. The balance is jointly held by the Danish Industrialisation Fund for Developing Countries, which will coordinate the funding of the project, and Danish independent power producer European Energy.

Other key partners in the project include the Eastern Cape Community Wind Energy Development Association (ECCWEDA); Danish wind turbine manufacturer Vestas; the Danish Export Credit Fund, which will provide debt credits; Danish energy utility Dong Energy, which will procure carbon credits from the project; and Danish wind labo- ratory Riso, which is responsible for wind measuring and mapping.

A feasibility study, including the envi- ronmental-impact assessment, National Energy Regulator of South Africa licensing applications and an Eskom grid connection application are currently under way, following completion of the prefeasibility study, which was undertaken by an independent consultant.

The community has been in discussions with Eskom regarding the construction of a 2 × 80-MW substation on the wind farm site, with a 132-kV transmission line to accommodate the project. This connection to the grid is expected to cost no less than R100-million, explains Watt Energy CEO and ECCWED chairperson Mcebisi Msizi. Riso, together with the Council for Scientific and Industrial Research, will erect a wind measurement mast on the proposed site in January, and two other masts will be erected by Vestas in March. The masts will be at varying heights to ensure adequate wind modelling for optimum wind yield.

Exxaro Growth Energy manager Thomas Garner stresses that there is “still a long road” before the TCWF is operational, and measurements at 60 m will need to be taken over a year.

The consortium will still need to establish a power purchase agreement with the single buyer office under the renewable-energy feed in-tariff programme, and there is, as yet, no guarantee that the power will be sold on to Eskom at this stage.

It is estimated that there is about 5 000 MW of wind power under development in South Africa, while government has mandated the procurement of 400 MW of wind power by 2013. The wind energy projects under development will, therefore, need to compete for the offtake of their power. These decisions will likely be based on affordability, especially regarding grid connection, as well as the broad-based black economic-empowerment shareholding of a project.

The TCWF project is said to be at a fairly advanced stage, compared with other wind projects under development in the country.

“The Wittekleibosch farm is currently undergoing extensive wind mapping to confirm the feasibility of the project. Thus far, the outcome has been extremely positive,” says Msizi.

Danish ambassador to South Africa Dan Frederiksen says that there is a strong group of Danish companies dedicated to this project, and which are assisting in establishing a framework to create understanding among authorities, investors and governments about what is required to create a sustainable renewable-energy project in South Africa.

Watt Energy COO Mark Scheepers explains that the Tsitsikamma community project is the first community on its way to developing a wind energy project. “All the ingredients are here. If we are successful here, we can do it elsewhere,” he says.

Msizi explains that the community will contribute their land and their wind to the project, and have ensured the careful selection of the Danish partners. He adds that the selection was not an easy process as many people, described as ‘snake charmers’, showed interest in developing wind energy projects in the area.

“The beauty of this project is that it has community development at the centre, but also has economic benefits and climate change benefits. It brings together people from different backgrounds – financiers, technology providers, the local community and entrepre- neurs – and weaves them into a tapestry of perfection,” said Department of Energy clean energy chief director David Mahuma.

The Danish embassy representatives, Danish businesspeople, South African companies involved in the project and local farmers, as well as government representatives and journalists, were treated to a traditional ceremony by the community from the Wittekleibosch farm and surrounds, which included dancing, singing and the slaughter of a goat.

The local community, who form part of the AmaMfengu tribe, were forcibly removed from their land in 1977 and relocated to the Ciskei. They began negotiations for the return of their land in 1990 and, after four years of negotiations, court applications and discussions, the land was returned to them. Currently, much of the land is still contracted to commercial farmers.