Indian-based Suzlon Energy, the world’s fifth-largest wind turbine supplier, is optimistic about the prospects for wind energy in SA.
The company announced on Wednesday that it had signed a contract with African Clean Energy Developments (ACED) – a joint venture between African Infrastructure Investment Managers and Macquarie Capital and AFPOC Limited – for the supply of 76 S88-2MW series turbines, with an option for ACED to acquire an additional 124 turbines for the Cookhouse Wind Energy Facility.
The Cookhouse Wind Energy Facility, which covers over 9,000 hectares and is situated about 150 kilometres from Port Elizabeth, is one of SA’s leading renewable energy projects. It received a positive Record of Decision from the Department of Environment in May 2010 for the erection of up to 200 wind turbines.
Tanti told I-Net Bridge in a telephonic interview that he was not overly concerned about the latest delay in the clarification of the Renewable Energy Feed-In Tariff (REFIT) tariffs.
The National Energy Regulator of SA (Nersa) said on Tuesday that it had delayed the approval of the REFIT Review Tariff until mid-June, as it was still analysing and consolidating information received from stakeholders after the public hearings earlier this month.
The delay of the reviewed tariff approval is likely to be a concern to independent renewable energy producers, which have been waiting for certainty before embarking on renewable energy projects.
Tanti said over the past two days he had “good meetings” with government and Eskom and he believed that government had a very strong commitment to renewable energy developments and to the need for green energy.
He said the process of bringing projects to approval by the regulator was complex, but he believed the various initiatives were going well and he expected that very soon government would announce clear direction for the next couple of years and make an announcement on the feed-in tariffs, the independent power producers agreement and project approvals.
“We are quite excited and optimistic that this will go in the right direction,” he said.
Tanti believed that SA had immense wind energy resources and government had “demonstrated praiseworthy vision and leadership to exploit this abundant renewable resource to power the nation’s growth: green jobs, energy generation and inclusive, sustainable growth”.
Although wind energy is a fairly new concept in SA, he said the country needed more renewable energy projects and had the potential for 30,000MW of wind energy.
Industrialised countries such as Germany, Spain, Denmark and the US are investing heavily in wind energy, but among developing countries, it is chiefly India, China and Brazil that have adopted it on a large scale.
Tanti estimated that based on SA’s energy needs, it would require another 40,000MW of energy in the next decade and 10,000MW of this could come from wind projects.
SA clearly figures largely in Suzlon’s plans. At its recent results presentation, the company reiterated its intention to focus on markets such as India, China, Brazil, SA and Latin America to drive its growth.
In addition, the group recently appointed former City Power MD Silas Zimu as country CEO and set up an office in SA, underscoring the group’s belief in SA’s wind potential and signalling its intention to play a major role in bringing that to fruition.
Zimu said the Cookhouse facility would not only provide clean and green energy, but also create many jobs and make a major contribution to local economic development.
The contract is conditional to the Cookhouse Wind Energy Facility successfully securing a power producer’s agreement under the REFIT procurement process, due to commence in the coming months, and the project successfully reaching financial close and meeting other standard conditions. Based on current expectations for the satisfaction of the main conditions, installation is expected to commence in late 2011 or early 2012.
ACED is working with its partner, the Industrial Development Corporation of SA, and with its appointed mandated lead arrangers, Standard Bank and Nedbank, to finalise a financing package that would include a significant portion of broad-based black economic empowerment ownership.
The Suzlon Group’s global spread extends across Asia, Australia, Europe, Africa and North and South America, with over 17,000MW of wind energy capacity installed in 25 countries, operations across 32 countries and revenues of about US$4 billion.