Power utility Eskom has revived two renewable energy projects


Johannesburg – Power utility Eskom has revived two renewable energy projects after the injection of funds from a World Bank loan earlier this month, the company said on Friday.
The power firm said in a newspaper advert that it would procure the construction of a 100 megawatts windfarm and a 100 MW concentrated solar power (CSP) plant. Both projects have been put on hold due to financial woes at the troubled utility.
Eskom supplies some 95% of South Africa’s power, with current capacity of around 40 000 megawatts.
Eskom has previously said some $260m of the total World Bank loan would go to the two renewable energy projects.
The company will try to seek the balance of the cost for the two projects, estimated at a total of between R9bn to R10bn, this year, Steve Lennon, Eskom’s managing director for corporate services told Engineering News in an interview.
Construction on both projects could start in early 2011, the online publication reported.
Lennon said the project teams were being reassembled and work was being accelerated to secure the remaining funds, either via concessional-type funding or commercial funding pools.
The projects are also likely to benefit from a $500m funding from the World Bank-administered Clean Technology Fund.
The Sere wind farm will be built near Skaapvlei, some 160km north of Cape Town. Eskom has said in the past the project could be scaled up to produce 200 MW in the future, but the company was not betting on wind as a major contributor to its power grid owing to its inconsistency .
The CSP plant will be built in South Africa’s Northern Cape province, seen as having the world’s highest solar potential.
Eskom is working with others, including the Clinton Foundation, on a regional “solar park” concept, that could include neighbouring Botswana and Namibia, Lennon said.
“We are developing the first project with a fleet model in mind,” Lennon was reported as saying, adding that there was enough sun for other investors to come in as well.
Eskom has said the country’s solar thermal potential was in the tens of thousands of megawatts.
The World Bank has faced wide criticism because of the loan, mainly to be used to pay for a coal-fired power plant, with countries and environmentalists accusing the bank for helping fund dirty power.
Eskom has been battling to raise funds to pay for new power plants needed to supply fast rising demand in Africa’s biggest economy, and the recently approved loan has raised its hopes to be able to close a R190bn funding gap.