Green initiatives News

Growthpoint signs landmark wind-hydro-solar PPA deal

SA CEO of Growthpoint Properties, Estienne de Klerk.

Growthpoint Properties has entered into a Power Purchase Agreement (PPA) with Etana Energy for 195GWh of renewable energy per year, representing 32% of its total current annual electricity consumption of 612GWh in FY2023.

In November 2023, the REIT signed a PPA with licensed electricity trader Etana Energy to wheel electricity to its commercial assets in several jurisdictions across South Africa.

The deal has set in motion the country’s first multi-jurisdiction, multi-building, multi-source renewable energy wheeling arrangement which will enable Growthpoint’s tenants to access green energy and to reduce their carbon footprint.

Through this agreement, Etana Energy will cover 70% of the power consumed by Growthpoint’s buildings and in some buildings, Growthpoint’s tenants will be able to purchase 100% renewable energy.

The wheeled renewable energy will mainly consist of wind, with a smaller component of hydro and large-scale solar electricity. The combination of generation sources allows for a high coverage of Growthpoint’s energy use, as electricity is generated throughout the day and night.

This initiative significantly advances Growthpoint’s progress towards our climate commitment of being carbon neutral by 2050. We are extremely pleased to collaborate with energy innovators like Etana and Serengeti to support our tenants to reach their own environmental goals by giving them access to renewable energy,” comments SA CEO of Growthpoint Properties, Estienne de Klerk.

Growthpoint has exclusive rights to purchase all the +-30GWh that will be generated annually by a 5MW hydroelectric power plant developed, owned and operated by Serengeti Energy. The project is situated on the Ash River within the Lesotho Highlands Water Scheme (LHWS), close to Clarens in the Free State, which provides the added benefit of effectively generating 24/7 baseload power. Growthpoint has also shown some interest in investing in the power plant by signing a Memorandum of Understanding with Serengeti Energy. Serengeti Energy owns and manages renewable energy projects of up to 50MW (mainly hydro) in sub-Saharan Africa and currently operates nine plants in five countries.

Initially targeted for South Africa’s Renewable Independent Power Producer Programme (REIPPPP), which contributes private sector-produced electricity to the national grid, Serengeti’s focus for this hydro plant shifted, and it advanced the project for the commercial and industrial sectors.

“Hydro as a technology most definitely has a role to play in the energy mix in South Africa. It is encouraging for our sector to have concluded a PPA with Etana and Growthpoint, supporting appreciation for this technology not only for industrial use but also in the commercial sector,” comments Strafford Harris, Managing Director SA, Serengeti Energy.

The project is being constructed on the water transfer scheme between Lesotho and South Africa, within the LHWS and positioned to produce reliable baseload power. It is also well placed to capitalise on the LHWS Phase 2 future expansion. The hydroelectric power plant has reached financial close and is currently under construction. The commercial operations date is expected to be the 1st of July 2025, when it will supply its first electricity to Growthpoint, wheeled via the Eskom grid and traded through Etana.

Thereafter, the commissioning of wind and additional solar production from Etana’s portfolio of renewable energy projects connected to the national electricity grid will commence.