JSE-listed Sasol and Air Liquide have signed new power purchase agreements (PPA) with the global wind and solar company Mainstream Renewable Power.
Air Liquide operates the world’s largest oxygen production site at Sasol’s Secunda operations in South Africa.
This was the third set of PPAs signed by Sasol and Air Liquide after those announced in the first quarter of this year and was the first of the decarbonisation projects to have reached financial close. The solar power plant was scheduled to be operational in 2025.
Sasol Energy Business executive vice-president Priscillah Mabelane said they had reached a critical milestone yesterday with their announcement of the first Secunda decarbonisation renewable project reaching financial close.
“This is significant progress towards Sasol’s ambition to reduce its absolute scope 1 and 2 greenhouse gas (GHG) emissions by 30% off a 2017 baseline. Sasol is committed to pursue the renewable procurement as a key lever for reducing GHG emissions, and we have made significant progress in procuring over 600 megawatts,” Mabelane said.
As previously communicated, Sasol and Air Liquide have signed close to 600MW for Secunda of which more than 200MW received grid access from Eskom over the 97.5MW announced by Mainstream Renewable Power.
Air Liquide’s CEO of the Africa Middle East & India hub, Nicolas Poirot, said that with their long-term partner Sasol, it had secured massive amounts of renewable energy generation capacity.
“This will significantly contribute to the decarbonisation of our operations in Secunda and actively support the development of renewable energies in South Africa, for the benefit of the South African electrical system and ultimately of the South African society in the context of a just transition.”
South African Photovoltaic Industry Association (Sapvia) CEO Dr Rethabile Melamu said the organisation wished to congratulate its member Mainstream Renewable Power on reaching financial close on a 97.5MW solar PV farm, which has 20-year PPAs with Sasol and Air Liquide.
“The announcement indicates a maturing of the South African renewable energy and solar PV market and shows the trust placed in the technology by a listed entity signing a private sector power purchase agreement for 20 years and paves the way for other large corporates to follow suit,” Melamu said.
The organisation said the local large-scale PV sector would take confidence from the announcement as it built momentum in the large-scale private off-take market.
“Twenty-nine solar PV projects with a combined capacity of 2 200MW have been registered in 2023 with the national energy regulator, equivalent to the total capacity operational due to public procurement.”
Melamu said the project would take about 18 months to construct and connect to the grid and would be successful due to project management expertise, a mature and trusted technology and the hard work of the on the ground construction crews.
In addition, the Sasol and Msenge Emoyeni Wind Farm agreement for 69MW of renewable energy supply to Sasol’s Sasolburg site reached financial close in early March this year and was currently under construction. The project was scheduled to be fully operational in the second quarter of next year.
Meanwhile, speaking at the opening of European Hydrogen Week on Monday, Higher Education, Science and Technology Minister Dr Blade Nzimande said South Africa had committed to ambitious emission reduction targets, but taking into account its transitional energy mix.
“Our estimates indicate that green hydrogen has the potential to reduce 10 to 15% of our domestic emissions and contribute to our nation's long-term energy security,” Nzimande said.
The department said it was estimated that the hydrogen economy had the potential to add 3.6% to South Africa’s gross domestic product by 2050 and create more than 370 000 jobs.