12 Nov 2019

CSP transforming the energy landscape

Global Smart Energy Elites 2019
Image credit: Kathu Solar Park

Concentrated Solar Power (CSP), as a viable alternative to traditional electricity baseload power, has demonstrated alignment with the South African governments’ national agendas of achieving inclusive growth including job-creation, manufacturing, construction and rural development.

South Africa’s Northern Cape Province is home to a 100MW greenfield Concentrated Solar Power (CSP) project, which is providing clean and reliable energy to 179,000 homes, while promoting local employment and bolstering the region’s business sector. The Kathu Solar Park is modelled with parabolic trough technology and equipped with a molten salt storage system that allows 4.5 hours of thermal energy storage and thus limits the intermittent nature of solar energy and guarantee dispatchable energy generation to meet on demand needs.

The plant was first synchronised to the grid in October 2018 and started commercial operation in January 2019. Siyabonga Mbanjwa, Regional Managing Director of SENER Southern Africa stated: “With the completion of Kathu Solar Park, we show our firm commitment to the development of a renewable energy industry in South Africa. Concentrated Solar Power, as a viable alternative to traditional baseload sources of energy, has a demonstrated alignment with South Africa’s national agenda of achieving inclusive growth that includes job-creating, manufacturing, construction and rural development. Reaching commercial operation at Kathu means that the energy supply to the local community is secure and demand is well managed while contributing to mitigate the effects of climate change”.

Ramón Jiménez, Managing Director of the Industrial business at ACCIONA, said, “The Kathu Solar Park project is another example of ACCIONA’s commitment to renewable energy. Construction of this plant has had and will have a major impact on the economy and residents of the Northern Cape region in South Africa.

Kathu Solar Park provides the local community with a safe and manageable power supply, helping to offset the effects of climate change. Its construction has been a complete success thanks to the team that worked on the project, as well as the excellent relationship with the local administration, the business sector and with our client Kathu Solar Park.”

The project forms part of the South African Government’s Integrated Resource Programme (IRP) 2010, which aims to increase the country’s power generation capacity to 86.8 GW by 2030, of which 24% will be renewable-generated power. The Kathu Solar farm was one of the projects awarded during bid window 3.5 of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) by the South African Department of Energy (DoE).

The joint venture between SENER and ACCIONA was appointed by the shareholders, which is led by ENGIE, including a group of South African investors comprising SIOC Community Development Trust, Investec Bank, Lereko Metier Sustainable Capital Fund, its co-investors FMO, the Dutch development bank and DEG, the German investment and development company and the Public Investment Corporation to provide the engineering, procurement and construction services on the project.

The principle that has governed the entire project is that of sustainability in all areas: economic, social and environmental. All the parties involved in the completion of Kathu Solar Park showed firm commitment to the development of a renewable energy industry in South Africa.

From an environmental point of view, it is estimated that the Kathu Solar Park will save six million tonnes of CO2 over 20 years. Additionally, as South Africa has fallen victim to water scarcity over the past few years, this innovative technology installed at the plant will save eight million cubic metres over its two decades of commercial operation. The plant is an exemplary project executed with excellence, confirming this CSP plant as an efficient solution in the renewable energy sector for its technological, economic, social and cultural legacy in the Northern Cape.

The initial phase of this project involved a detailed study of the characteristics of the local communities. The project is located in John Taolo Gaetsewe (JTG) district on the African savannah, in an area where the main economic activities are agriculture, livestock and mining.

At present, the region suffers from high levels of poverty (49.8%), low levels of education (76.4%) and an extremely high unemployment rate (29%), although it has significant potential as a tourism destination and growth opportunities in the industrial sector. When the construction of the plant commenced in May 2016, up to 1,700 direct jobs (roughly 5,000 jobs in total, including direct, indirect and induced jobs), were created of which 42% of the workforce was hired from the local community, impacting positively the local employment prospects. Moreover, more than 10,000 jobs per year will be created in total over the course of the plant’s useful life. The Kathu Solar Park will also promote local economic development from subcontracting other services to local businesses.

The project achieved a 45% local content acquisition mark and has also contributed to the economic development of the region by contracting local suppliers. Specialist training to ensure the transfer of knowledge to the future staff of the plant was also given to local personnel so they will be able to operate and maintain the plant in the future. During the construction phase, a total of 25 social management measures were carried out, supporting more than 16,957 beneficiaries. All of the social initiatives are being channelled through an independent organisation, the Kelebogile Trust, established and fully funded by the EPC consortium SENER and ACCIONA with an investment of R29,300,000.

Some 75% of the budget available for these activities was used to improve education levels in the community, while the remaining 25% was allocated to boost small and medium-sized businesses in the region, and to improve training for their employees to create new business opportunities and encourage local hiring. In addition to this, the Kathu Solar Park has set up a Social Economic Development (SED) programme, investing R8,500,000 (€530K) on 27 initiatives during the construction phase; and will allocate 1% of the revenue during the operation phase for education, health care, social welfare projects in the John Taolo Gaetsewe district with the aim to further foster more local and rural progress.

The Kathu Solar Park has made a positive and enduring difference through innovation and technology, with high efficiency and performance to deliver energy to the South African grid, particularly during the evening peak. SENER is currently installing the same technology in all the new CSP parabolic trough plants worldwide and the experience achieved during the Kathu Solar Park project will certainly contribute to the next generation of solar power plants all over the world.

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