Independent power producer Cennergi, has announced that its 68MW Lephalale Solar Project (LSP) has reached financial close. The project will supply renewable energy to Exxaro’s Grootegeluk flagship mine based in the Limpopo Province of South Africa.
The solar project will be built on a 236-hectare site, and will serve as a behind-the-meter energy source. The electricity generated by the solar plant will be supplied to Exxaro for its Grootegeluk mine for 25 years, through a power purchase agreement (PPA).
According to Cennergi, the solar project will be financed through limited recourse project finance debt from lenders, as well as equity investment from its sole shareholder, Cennergi Holdings. Construction time is planned for 19 months.
“We are thrilled to unveil the Lephalale Solar Project as a landmark renewable energy initiative in partnership with Exxaro,” Leon Groenewald, MD Energy at Exxaro Resources, the parent company of Cennergi.
Cennergi stated that the project will be constructed through a fully wrapped, engineering, procurement, and construction (EPC) contract, and that the operations and maintenance (O&M) of the solar facility will be entrusted to a highly experienced operator.
Exxaro’s renewable energy pivot
The Lephalale Solar Project was developed as part of Exxaro’s Sustainable Growth and Impact (SG&I) strategy. The company is the largest coal producer in South Africa, supplying to state-owned electricity utility Eskom. The coal mining giant is looking to pivot to renewable energy as part of its long term strategy.
“By leveraging solar power to meet the energy needs of the Grootegeluk mine, is a follow through on our commitment to business sustainability and supporting the transition towards a greener future,” said Exxaro CEO, Dr Nombasa Tsengwa.
“This project represents a significant milestone in South Africa’s renewable energy landscape and showcases the enormous potential of clean energy in driving economic growth and reducing carbon emissions,” Tsengwa concluded.