ACWA Power, the Saudi developer, investor and operator of power generation and water desalination plants has announced the commencement of construction on the 100MW Redstone project following achievement of financial close.
At ZAR 11.6 billion (162.457 million) total investment, the Redstone project is the largest renewable energy investment in South Africa to date.
Redstone CSP has facilitated approximately ZAR 7 billion ($98 million) in foreign direct investment to fund and support the strategic energy transition goals of the country. ACWA Power’s co-shareholders in the project include the Central Energy Fund, Pele Green Energy and the local community.
The project has secured financing from leading international and South African financial institutions including African Development Bank (AfDB), ABSA Bank, Development Bank of Southern Africa (DBSA), CDC Group, Nedbank Limited, Nederlandse FinancieringsMaatschappij voor Ontwikkelingslanden (FMO), Deutsche Investitions- und Entwicklungsgesellschaft (DEG), Investec Bank and Sanlam Life Insurance.
Commenting on the occasion, Paddy Padmanathan, President and Chief Executive Officer of ACWA Power, said: “As grid links are improved, the ingenuity of the private sector together with the great support of experienced finance partners has the potential to spark lasting impact for local communities and address the threats of climate change.”
Located in the Northern Cape Province of South Africa, the plant will be equipped with a 12-hour thermal storage system that will deliver clean and reliable electricity to nearly 200,000 households round the clock.
Commencement of operations is scheduled for Q4 2023.
Mr. Rajit Nanda, Chief Portfolio Management Officer and Acting CIO for ACWA Power, added: “We are proud to play a key role in supporting South Africa’s decarbonisation efforts, and are grateful to our partners for contributing to our mission to reliably and responsibly deliver power and desalinated water at an affordable cost. Following in the footsteps of the record-breaking Bokpoort CSP and deploying the same thermal salt storage system, Redstone CSP… [will benefit] households in the area with remarkable plant performance.”
The project will reach close to 44% local content on procurement during the construction period; create more than 2,000 construction jobs at peak, with about 400 from the local community; and create approximately 100 permanent direct jobs during the operating period.
As part of its implicit social contract, Redstone CSP will provide value-adding ancillary services required by the system operator at no cost to the local public utility Eskom, which marks a first for a renewable energy plant in the country.