EIB finances the DBSA’s R1,4 billion renewable energy project in Northern Cape
The Development Bank of Southern Africa (DBSA) has signed with the European Investment Bank (EIB) a R1,4 billion (US$130.4 million) finance contract to support the development of the KAXu 100 MW concentrated solar power plant in the Northern Cape, South Africa.
The South African energy sector is faced with a number of challenges. The DBSA and EIB are encouraged to support South Africa's power generation infrastructure to improve the security of energy supply and optimise the energy mix which is much needed to accelerate the economic growth of South Africa.
The shareholders will be Abengoa Solar South Africa (Pty) Ltd (“ASSA”) (holding 51%), Industrial Development Corporation of South Africa Ltd (“IDC’) (holding 29%) and a respective community trust backed by Broad-Based Black Economic Empowerment (BBBEE) funders (holding 20%).
!Ka Xu is a 100 MW parabolic trough CSP plant, with approximately 2.5 hours of molten salt storage, located 40 km from the town of Pofadder with an estimated total cost of ZAR 7.5 billion (approximately US$860 million). The solar plant will be located on the land of farm Scuit Klip 92 and will feed power into the Eskom Paulputs substation located approximately 1 km from the site.
Once fully developed the KaXu concentrated solar thermal plant will collect solar energy using parabolic trough technology and convert it into electricity in the steam cycle. Through a built-in molten salt storage system or the thermal energy storage (TES), the plant will have capacity to store energy during off peak hours and dispatch it during peak hours. KaXu Solar One will prevent 315,000 tons of CO2 emissions each year.
Like all other transactions appraised for funding by the EIB, this project was subjected to the EIB’s environmental appraisal guidelines to ascertain its impact on the environment. The DBSA is confident that this investment in the renewable energy programme will have positive contribution towards efforts to minimise adverse impact of energy generation on the environment and in particular on climate change.
