South African investment holding company Shanduka Group, together with its consortium partners, will shortly begin construction of a 73.8MW wind power project near Victoria West in the Karoo. The project, Noblesfontein Wind Power Project, reached financial close earlier this month.
The project is one of those identified by the Department of Energy as part of the first round of its Independent Power Producer Procurement Programme (IPPPP). Power purchase and implementation agreements were signed with the department and Eskom earlier this month.
Around R1.5 billion will be invested in the project over the next two years. The project is expected to start generating power from July 2014.
The project is driven by a consortium of Shanduka (with a 25% stake), Gestamp Wind (60%), a Spanish company that develops, constructs and operates wind farms in the world’s leading wind energy markets, and Sarge (12.5%), a Cape Town-based renewable energy developer. Of the shareholding, 2.5% is allocated to a communities trust.
Around R2.5 million (or 1% of revenue) per annum will go to the Noblesfontein Educational Trust. The trust will hold a 2.5% stake in the project.
Shanduka Group CEO Phuti Mahanyele said the project would be funded through debt and equity. Shanduka Energy’s contribution for its 25% equity stake in the project is approximately R119 million.
“Our country has one of the most exciting renewable energy programmes in the world. This project will not only help to address our current energy supply issues, but also provides us with an opportunity to create sustainable employment and development,” said Mahanyele .
Since wind energy is typically installed in remote and low density population areas, it can contribute to improving the spatial distribution of opportunities and uplift rural areas. The consortium is committed to transforming the local communities in Victoria West area.
Shanduka Energy is currently evaluating a number of renewable energy projects both within and outside of South Africa.