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9 new mega-projects coming to South Africa
6 December 2022
Minister of public works and infrastructure Patricia de Lille has gazetted the registration of nine infrastructure projects in the country with Infrastructure South Africa (ISA).
The gazette served to amend the country’s Strategic Integrate Projects (SIPs), specifically those affecting the energy sector.
According to De Lille, under the SIPs, the Just Energy Transition, Green Hyrdorgen National Plan and the Oil & Gas National Program will be fast-tracked.
With these projects being designated as Strategic Integration Projects (SIPS), the procurement process, as well as administration of the projects, is sped up by the government.
In a previous media statement, De Lille said: “This means that all processes relating to the implementation of SIPs, including processes relating to any application for any approval, authorisation, licence, permission or exemption and processes relating to any consultation and participation now run concurrently instead of the usual process which is sequential.”
The publication of the latest gazette marks the beginning of projects specific to the country’s energy sector, including those in the green hydrogen field.
De Lille listed the following projects that will be fast-tracked through SIPs:
The Prieska Power Reserve in the Northern Cape
The Ubuntu Green Energy Hydrogen Project in Northern Cape
Boegoebaai Green Hydrogen Development Programme in the Northern Cape
Atlanthia Green Hydrogen in the Western Cape
Upilanga Solar and Green Hydrogen Park in the Northern Cape
Sasolburg Green Hydrogen Programme in the Free State
SASOL HySHiFT (Secunda) in Mpumalanga
HIVE Ammonia in the Eastern Cape
Hydrogen Valley Programme of Anglo-American and their JV Partners
She noted that the following projects are still waiting for final information before registration with ISA can proceed:
Mainstream Renewable Energy Hydrogen in the Western Cape
AMSA Saldanha Steel Hydrogen project in the Western Cape
Enertrag Postmasburg Project. (Ammonia) in the Northern Cape
HDF Energy Renewable Energy, IPM 1 in Mpumalanga
Enertrag Indigen Project (e-methanol) in the Eastern Cape
Isondo Fuel Cell MEAs Manufacturing in Gauteng
Isondo / NCP Vehicles in Gauteng
Saldanha Bay Green Hydrogen Project
Project Phoenix Fuel Cell Manufacturing in Free State
Cape Stack in the Western Cape
Bambili Hyplat Fuel Cell Manufacturing
South Africa has been deemed a hotspot for green hydrogen. Infrastructure South Africa (ISA) has reported that it amassed a total of R300 billion for funding green hydrogen projects alone.
De Lille said that despite such a large portion of available funding, more needs to be done for future projects to reach their end.
Speaking at the country’s first Green Hydrogen Summit late last month, President Cyril Ramaphosa said South Africa is determined to become a world leader in green hydrogen.
“South Africa has many inherent advantages that make it internationally competitive in the production of green hydrogen, said Ramaphosa. “These include a world-class endowment of both onshore wind and solar irradiation.”
According to Ramaphosa, 2.4 million tons of grey hydrogen is already manufactured domestically and used for consumption. He added that projects such as renewable energy ones present a unique opportunity for the country to drive industrialisation.
South Africa is a must-have destination for foreign green energy investment, said Ramaphosa.
Some critics of the government’s plans have urged caution, however, warning that green hydrogen is not the silver bullet or energy panacea that many – including the South African government – are making it out to be.
3 big new solar projects launching in South Africa this week
Bloomberg7 December 2022
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Engie SA expects to move forward with three South African solar projects this week as the nation struggles to accelerate a program to add renewable power.
The French developer plans to sign power-purchase agreements for a total of 225 megawatts of solar projects after being selected as a preferred bidder as part of the so-called fifth bid window, according to Mohamed Hoosen, Engie’s managing director for renewables in Africa, Middle East and Asia.
South Africa picked 25 wind- and solar-power projects to be built by private developers last year to reduce the nation’s reliance on coal for electricity and end rolling blackouts that are curbing economic growth. Those plans have faced various delays and challenges to reach financial close.
“It’s always a challenge — the market has changed fundamentally to how it was 18 months ago,” Hoosen said in an interview, referring to factors including a surge in supply-chain costs.
South Africa revised commercial close timelines for the projects chosen in the fifth bid window. It’s since signed some agreements in a staggered order. Developers also await the selection of preferred bidders for the sixth bid window.
The company remains interested in realizing more projects through the government program, Hoosen said. “To the extent that they bring these programs to market, we will be there to submit our bids.”
As part of South Africa’s energy transition, about 53,000 megawatts of wind and solar plants will be required over the next decade as ageing coal stations, currently producing over 80% of the nation’s electricity, are retired, according to state-owned utility Eskom.
Job Creation
Plans to switch from a dependence on coal mean South Africa, with one of the worst unemployment rates in the world, needs to replace jobs that would be eliminated. A proposed solution is building or assembling some of the equipment in the country.
“There is tremendous value in establishing a local base for manufacturing,” though there are some preliminary conditions, Hoosen said. “You need the certainty and reliability of the deployment of renewables” and you need to be competitive.
Engie has about 320 megawatts of renewable projects operating in South Africa, including two concentrated solar power stations capable of storing electricity for hours. That’s giving way to the use of photovoltaic panels with batteries “as we look at the evolution of technology and cost,” Hoosen said.