Three wind farms part of bid window 5 reached financial close last week and they will power 480 000 South African households once they start operating.
The projects are being developed by Red Rocket Energy. They are among the 25 preferred bidders first announced in late 2021. They are part of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).
There are now six projects – the other three being wind projects developed by EDF renewables – that have reached financial close. In December 2022, Mineral Resources and Energy Minister Gwede Mantashe signed legal agreements—such as the power purchase agreement - with 13 bidders.
In a statement issued by Absa, which is the main lender for the projects, two of the wind farms have a capacity of 140MW and will be located in the Western Cape. One of the wind farms, to be located in the Eastern Cape, has a capacity of 84MW.
The whole development is estimated to cost R12 billion. Red Rocket is not only developing the project but will also invest equity in the projects, together with IDEAS Infrastructure II Sub-Partnership - owned by Old Mutual Limited- and Jade-Sky Energy, another private company.
"The REIPPPP is critical in helping Eskom add renewable power generation capacity to the national grid in line with the country's just energy transition objectives and sustainable development goals," said Colin King, a principal within Absa's resource and project finance team.
In a presentation to Parliament last week, the Department of Mineral Resources and Energy indicated that a total of 16 projects are preparing to reach commercial and financial close by the end of March.