Eskom and Europe’s long-term lending institution, the European Investment Bank (EIB), have agreed a new €75 million (R1.1 billion) finance contract to support Eskom’s 100MW Concentrating Solar Power (CSP) plant close to Upington in the Northern Cape.
CSP uses a number of innovative technologies to concentrate the sun’s energy through large mirrors and utilises the concentrated thermal energy to produce steam to drive a conventional steam turbine for electricity generation. CSP technology is similar to conventional power plants in that steam is used to power a turbine and generator, but the fossil fuel combustion is replaced with free, non-polluting solar energy.
Ayanda Nakedi, Eskom’s Senior General Manager for Renewables said: “Eskom is committed to investing in projects that will diversify our energy mix, including renewable resources. The potential to deploy CSP technologies on a large scale is promising, and we are pleased to have taken another step forward in funding our Upington solar plant with this loan agreement.”
Pim van Ballekom, European Investment Bank Vice President, added that “Energy is essential for economic activity and investment in new renewable energy generation capacity can harness South Africa’s natural resources. The European Investment Bank is pleased to work with Eskom to support the CSP plant that will act as a model for similar schemes elsewhere and looks forward to continued engagement in South Africa under a new mandate agreed earlier this year.”
Speaking about Eskom’s relationship with the EIB, Eskom’s Finance Director, Ms Tsholofelo Molefe, said: “The EIB is a valued partner who plays a key role in the funding of not only the CSP project, but has also provided funding for other projects in Eskom’s capital programme.
This project is being co-financed with the African Development Bank, Agence Française de Développement, Clean Technology Fund (CTF), KfW and the World Bank.
The European Investment Bank has also provided a total of €220 million for the neighbouring Ka Xu CSP plant. The last part of this support to be provided through DBSA was agreed in June this year.
Over the last five years the European Investment Bank has provided more than €24 billion for renewable energy investment around the world.
The EIB is active both inside and outside the European Union, and provides finance and expertise for sound and sustainable investment projects.