Eskom, a South African utility, has signed lease agreements with four independent power producers to produce renewable energy around its power plants. The utility company estimates that the IPP will produce up to 2GW of renewable energy in two power stations in Mpumalanga Province. The plot will be around Majuba and Tutuka power stations, with a total of 6184 hectares of land leased for 25-30 years.

The South African government announced a series of measures in July 2022 to deal with the power shortage and alleviate the restricted power grid in the shortest possible time. Since then, Eskom is increasing its investment in renewable energy. Previously, the company launched a proposal request in April 2022, and investors were very interested in the request. Its offer has been over subscribed three times.

In the future, utility companies will issue new tenders every quarter to lease their other plots and accelerate investment in renewable power generation capacity, which can provide up to 30000 hectares of land for similar projects. According to Eskom, the land for the next stage will be concentrated on the real estate around Kendal and Kusil power stations in Mpumalanga, and the decommissioned Ingagan power station in KwaZulu Natal Newcastle, and will be provided to the market in the next few months.

Andrede Ruyter, CEO of Eskom Group, said that by providing Eskom land near power stations with sufficient grid capacity, we have taken innovative steps to find the fastest way to improve the national power generation capacity within our influence. The successful bidders in this round are HDF Energy South Africa, Red Rocket, Sola Group and Mainstream Renewable Power, which have obtained 1650 hectares of land for the construction of renewable energy plants.

Bidders must conduct a comprehensive feasibility study to determine which technologies they will use, solar, wind and battery storage technologies. Eskom expects that these power plants will be connected to the power grid within 2 to 3 years after the financial closure, subject to environmental, land zoning and other regulatory approvals. In addition, bidders will be able to sell electricity through the PPA, while electricity will be delivered through Eskom's grid, generating revenue for Eskom from existing assets.

Hein Reneke, Africa General Manager of Mainstream Renewable Energy Company, said that as one of the most mature and successful renewable energy companies in South Africa, Mainstream was honored to support Eskom in accelerating its efforts to connect a large number of much-needed clean and affordable power to the grid as part of the transition to renewable energy. In addition, De Ruyter said that the land lease will attract an investment of 2.2 billion dollars for areas traditionally related to coal-fired power generation, and will accelerate the connection of new capacity to improve the reliability of supply.Editor/Xing Wentao