ACWA Power Consortium Named Preferred Bidder of BOKPOORT CSP IPP in South Africa

Forming part of South Africa’s renewable IPP program, the BOKPOORT CSP Project will be implemented on a BOO (build, own, operate) scheme and will be designed to generate a net power output of 50 MWe.  The BOKPOORT CSP Project is to be equipped with the largest thermal storage ever adopted for a facility of its size.  When completed, the BOKPOORT CSP Project will be among the most efficient solar plants in the world operating in this class of capacity and technology.  It is expected to yield a record-high generation in excess of 200 GWh/year to support the power grid of South Africa.

The BOKPOORT CSP Project is one of only 19 projects selected by the Department of Energy of South Africa from among the 79 bids submitted for the second window of the country’s first Renewable Energy IPP procurement programme.  The BOKPOORT CSP Project was the only CSP technology selected.  The rest of the other projects are based on photovoltaic, wind and hydro technologies.

The ACWA Power-led consortium has selected a consortium of EPC contractors composed of TSK Electrónica y Electricidad S.A., Acciona Infrastructuras S.A., Acciona Ingeniería S.A., Sener Ingeniería y Sistemas S.A., all from Spain, and Crowie Concessions (Pty) Limited of South Africa.  The construction of the power facility will provide more than 40% of scope procured locally in South Africa.

The operation and maintenance will be undertaken by the consortium led by NOMAC, a subsidiary of ACWA Power.  The offtaker will be Eskom Holdings SOC Limited, a government-owned national utility. The target financial close is scheduled for the end of 2012 while the power facility’s Commercial Operation Date is planned for the third-quarter of 2015.

The BOKPOORT CSP Project has partnered with South Africa-based Investec Bank, Development Bank of Southern Africa and Industrial Development Corporation.  They will provide the debt funding requirements of the project.

In addition to direct investments and the creation of an excess of 900 jobs in South Africa during the construction period, the BOKPOORT CSP Project will also inject significant socio-economic value into the rural South African economy in the vicinity of the power facility (which is to be located in one of the poorest areas of the country) by bringing an average yearly contribution of US$2 million of additional investments and creating about 60 permanent employment opportunities during the operational life of the power facility.  

Whilst South Africa relies heavily on coal to meet its energy needs, the country is well-endowed with renewable energy resources that offer sustainable alternatives to fossil fuels.  With the CSP technology to be used, the BOKPOORT CSP Project will serve to abate “green approach” by saving approximately 230,000 tons of CO2 equivalent emissions for every year of operation.  The technology used in BOKPOORT will be a positive factor in offsetting the South Africa’s grid peak power demand period in particular due to its unique size of thermal storage.

Paddy Padmanathan, President & CEO of ACWA Power has stated that “We are proud to enter our fourth international market and first market in Africa.  Today we own majority stakes in fully operational assets in Oman and Jordan and a project under development in Turkey in addition to our assets in Saudi Arabia. The BOKPOORT CSP Project is a milestone in the company’s history and takes the ACWA Power further afield into the Southern Cone of Africa, which we see as strategic growth markets in addition to North Africa.  It will also diversify the company’s technology portfolio and fuel mix with the addition of our first solar plant. The project will be a lead in reaching our objective of reaching a total power production capacity of 30,000 MW by the end of 2014 with 5% in renewables with a focus on solar power.”

Padmanathan went on to say that “ACWA Power believes entering into a new market means a long-term relationship with the country as a whole and the local community in specific. Therefore, we put a great deal of emphasis on our participation in community development in our thought process taking into consideration the main socio-economic development requirements of the local community.  We will have a 10% community shareholding, which far exceeds the Government’s minimum 2.5% requirement.  Apart from the general upliftment of the local community through this economic interest, particular focus will be placed on youth development and HIV/AIDS awareness through Lovelife, a national NGO.  We have also sought to maximize on BEE involvement, far in excess of the minimum Government requirements, in the long term operations of the plant.  In this respect, we have partnered with a local BEE party, Invest in Africa Energy, not only to ensure local knowledge but to impart valuable skills transfer.”