The South African government has finally signed a power purchase agreement (PPA) for SolarReserve and ACWA Power’s 100 MW Redstone CSP project, ending more than two years of delays.
South African energy minister Jeff Radebe confirmed the news on Twitter. He announced that the South African government had signed agreements for 27 projects procured under the Renewable Energy Independent Power Producer Procurement Program (REIPPPP), one of which is Redstone.
In 2015, South Africa awarded a consortium led by SolarReserve and ACWA Power the Redstone project, at a tariff of $124/MWh. But in 2016, state utility Eskom – which had been facing ongoing financial difficulties – announced that it was postponing signing of the PPA.
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The PPA is for 20 years, and it will see Redstone deliver clean electricity to more than 200,000 South African homes for up to 17 hours each day, including during peak demand. The plant will store 1,200 MWh of energy daily. It will be located near Postmasburg in the Northern Cape Province, adjacent to the 75 MW Lesedi and 96 MW Jasper PV plants that were also developed by SolarReserve.
South Africa has strict requirements in regards to foreign investors and their use of local content. During the Redstone construction period, more than 43% of capital costs will be spent on South African content. The Black Economic Empowerment program will have a 26% share in the project, and more than 700 million rand ($58 million) will be spent on small- and medium-size enterprise and socio-economic projects over the 20-year period of the PPA.
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