West Coast. AfDB loan concludes 100-MW Eskom wind farm funding phase, for Vredendal
The $365-million African Development Bank (AfDB) loan to South African power utility Eskom, which was announced on Sunday, has effectively concluded the funding phase for the 100-MW Sere wind farm project and a process is already under way to now procure the key components for the development.
The new funding, comprising $265-million from the AfDB’s own resources and $100-million from the resources of the Clean Technology Fund (CTF), would supplement the $700-million received for the noncoal-related funding arising from the $3.75-billion World Bank loan secured in April 2010.
It was also additional to the $151-million secured for the Sere project from French development agency Agence Française de Développement.
Further development finance was still being sought for a proposed 100 MW concentrated solar power (CSP) project, which could be developed near Upington, in the Northern Cape. However, an expression of interest (EoI) had already been released for one of the components for that facility.
Eskom spokesperson Hilary Joffe told Engineering News Online that pre-qualification for the supply and installation of the Sere turbines had commenced, while an EoI for the owners’ engineer or consultant had also been released.
Eskom was yet to make its turbine selection and would, thus, not comment on the capacity of the individual units, nor on the anticipated capital investment involved.
But following the signing of the AfDB loan in Washington DC, in the US, Eskom indicated that it planned to begin construction of the wind project, to be sited in Vredendal, in the Western Cape, early next year. An environmental impact record of decision had also been secured for both the wind and the CSP project sites.
The loan had attracted a guarantee from the South African government, the agreements for which were singed by Public Enterprises Minister Malusi Gigaba and Finance MinisterPravin Gordhan.
AfDB president Donald Kaberuka said that leveraging and accelerating the disbursement of concessional climate financing would be critical to the deployment of clean technology solutions in Africa and was a priority action area for the bank.
Eskom also became the first South African public sector beneficiary of the CTF. However, when South Africa approached the CTF in 2009, the country investment plan included both public and private sector projects.
Besides the Eskom renewables programme, the Department of Energy had released the tender documentation for the procurement of the first 3 725 MW of independent power producer renewables capacity.
That request for proposals was released on August 3 and the first submission window would close on November 4.
Some potential investors have questioned why Eskom was pursuing its own rival renewables campaign, albeit that it had been disqualified from the DoE’s bidding process.
“We have committed to move towards a cleaner energy future and we are seeking to reduce our dependence on coal and diversify our energy mix. These large-scale renewables projects are in pursuit of those objectives, but we are also retrofitting existing facilities with renewables (for example by adding solar photovoltaic at Lethabo and Kendal) to ensure energy efficiency and reduce our carbon emissions,” Joffe explained.
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