The South African CSP industry was boosted by the announcement that financial closure has been achieved on the two projects that were awarded approved bidder status in Round I of the REIPPP.
The South African CSP industry was boosted by the announcement that financial closure has been achieved on the two projects that were awarded approved bidder status in Round I of the Renewable Energy Independent Power Procurement Programme (REIPPP).
The 50 MW solar power tower Khi Solar One and the 100 MW parabolic trough plant KaXu Solar One, located in the Northern Cape Province near Upington and Pofadder respectively, are being developed by Abengoa and have now started construction to meet their commissioning targets in 2014.
The financial closure deadline for Round I projects had been originally scheduled for June 2012, but was pushed back almost five months to 5th November. However, despite this delay the industry has acknowledged that the signing of PPAs with Eskom, and the ability for projects to attract the necessary investment, will have a positive impact on CSP’s future in this region.
Experts widely acknowledged that delays to closing finance for projects has made it difficult for developers and EPC groups to commit more resources to the development of plants in South Africa, due to the lack of clarity on how many megawatts will be available in future rounds. The progress of projects in Round I, and subsequent financial closure of Round II projects in March next year, will lead to further allocation for CSP and consequently stronger market longevity that will attract more players into this region.
Furthermore, with the recent announcement by South African Energy Minister Dipuo Peters that the REIPPP will be extended into a rolling procurement programme, with an additional allocation of 3,200 MW to be added for projects to be developed by 2020, further backing has been added to the permanence of CSP in South Africa.
This recent stream of positive news comes with a caveat, as experts have also highlighted the necessity to build existing plants on time and on budget as a clear driver for future industry growth.
Leading CSP companies are due to meet in Pretoria on 4-5 February at CSP Today South Africa 2013, where the progress made by developers and the impact this has had on CSP’s future will form an important part of the discussion.
Event organizer Jack Ahearne said that “with both local and international players present, we hope to assess the impact of Round I of the REIPPP, looking at how the success rate of current projects will impact the entire South African CSP industry’s track record beyond Round III”. Experts from Abengoa and AWCA Power have confirmed to share their experiences in the region, as well as Standard Bank, Investec, NedBank and the Industrial Development Corporation who will explain their role in financing plants currently under development.
The event is set to take place on 4-5 February in Pretoria, with over 200 delegates in attendance. For more details about the summit go to the website: