NOA clinches milestone wheeling energy agreement with Tronox

Andrew Taylor, chief executive of NOA Trading, NOA’s trading subsidiary. SUPPLIED.

Andrew Taylor, chief executive of NOA Trading, NOA’s trading subsidiary. SUPPLIED.

Published Jun 7, 2024


NOA Group Holdings (NOA) has reached a 497GWh energy supply agreement with Tronox Holdings, which has titantium dioxide pigment operations in KwaZulu-Natal and the Western Cape, and which is South Africa’s biggest private wheeling agreement to date.

The agreement extends Tronox’s renewable energy penetration to above 70% of its electricity requirements, and it underscores NOA’s model of aggregating power from a fleet of generation facilities across the country, to be supplied to Tronox’s operating sites in South Africa.

South Africa’s fast deregulating electricity sector, sped along by load shedding, has seen Eskom develop a model to allow renewable electricity wheeling and which will allow NOA, an integrated energy company, to provide renewable energy from wind and solar facilities nationwide to customers in the commercial and industrial sectors.

“This model represents an advancement in renewable energy supply solutions for commercial and industrial off-takers in South Africa, representing the largest private wheeling transaction between an aggregator like NOA, and a private offtaker,” said Andrew Taylor, chief executive of NOA Trading, NOA’s trading subsidiary.

He said NOA’s aggregation and trading platform separates energy generation from consumption, unlike traditional bilateral agreements that are tied to specific generation sites, which ensured a more flexible, efficient and reliable energy supply.

Under a 25-year supply agreement, NOA would deliver renewable energy to Tronox’s five sites across the Western Cape and KwaZulu-Natal. The agreement also meant that Tronox was aligning with an industry-wide move towards lower carbon operations.

“Tronox’s solar and wind renewable energy agreements with SOLA and NOA will reduce our global Scope 1 and 2 greenhouse gas emissions by 25% compared to our 2019 baseline, marking significant progress on our decarbonisation roadmap towards net zero carbon emissions.” said Tronox’s chief sustainability officer Jennifer Guenther in a statement.

Taylor said the initiative would be bolstered by the issue of verified International Renewable Energy Certificates, which authenticates the delivery of renewable energy.

NOA was leveraging significant equity investment to solidify its position in the renewable energy market in South Africa and create strategic partnerships with established companies, said Taylor. The company has R3.2 billion of equity capital, committed by NOA’s majority shareholder, AIIM.

He said the transaction with a blue-chip off-taker such as Tronox was viewed as a flywheel deal for NOA, enhancing it’s standing and capabilities in the sector.

Decarbonisation is critical for mining and industrial companies taking aim at net-zero targets. For Tronox, achieving this goal would largely be by increasing the use of renewable energy – this latest agreement facilitates an annual offset of over 500 kilotons of carbon, Taylor said.