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July 20, 2022

Scatec reaches financial close for renewable projects in South Africa

The projects will have a combined solar capacity of 540MW and battery storage capacity of 225MW/1,140MWh.

Norwegian renewable energy firm Scatec has achieved financial close for three renewable projects in South Africa’s Northern Cape province.

The three projects are located in Kenhardt and will have a combined solar capacity of 540MW and battery storage capacity of 225MW/1,140MWh.

Scatec will now begin construction of the projects.

Once complete, the renewable assets will deliver 150MW of dispatchable power to the Kenhardt region under a 20-year power purchase agreement.

They will involve a total capital expenditure of around R16.4bn ($962m), which represents Scatec ’s largest investment to date.

Scatec CEO Terje Pilskog said: “Achieving commercial and financial close for the Kenhardt projects shows true commitment by our Scatec team and partners.

“This project is a first of its kind and will be one of the world’s largest solar and battery facilities.

“We are now looking forward to starting construction of this unique and exciting project, which will be a major contribution to South Africa’s economy and green energy sector.”

The projects will be developed under the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP).

Scatec will own a 51% stake in the project, while local partner H1 Holdings will hold the remaining interest.

Scatec will also be the engineering, procurement and construction (EPC) contractor for the power plants, as well as offer operation and maintenance and asset management services for them.

The total value of this work will be around R13.7bn.

Scatec Sub-Saharan Africa general manager Jan Fourie said: “This is an important milestone in the procurement of renewable energy and proves that the sector can be relied upon to deliver much-needed electricity capacity to the grid.”

Earlier this month, Scatec began construction works on the Mendubim solar project in Brazil alongside Equinor and Hydro Rein.

The company will hold a 33.3% interest in the 531MW solar project and provide EPC services for it.

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