Indian wind turbine manufacturer Suzlon Energy is to supply up to 200 turbines for an undisclosed sum to a 300 MW wind farm planned by a consortium of Australian bank Macquarie Capital and South African insurer Old Mutual in South Africa.
According to Business Report, Suzlon’s deal with African Clean Energy Developments (ACED) for the proposed wind farm in Cookhouse, a small town in the Eastern Cape about 150km from Port Elizabeth, is understood to be the first formal agreement to be concluded for the supply of wind turbines to a South African project.
It is conditional on the Cookhouse wind farm developers securing a power purchase agreement under the very competitive renewable energy feed-in tariff procurement process.
Suzlon chairman Tulsi Tanti said during a visit to South Africa that the company was in supply talks with five developers of wind farms in South Africa, including the Cookhouse project. He expected completion of other agreements in the near future.
Suzlon was eyeing South Africa as a potential manufacturing base, alongside sites in India, China and Germany and Brazil. Asked for details, Tanti said: “It’s too early to say… The market is just starting.”
Tanti said a local base would require the addition of between 600 MW and 800 MW of electricity from wind sources each year. South Africa’s integrated resource plan envisages a total of 8400 MW of wind power by 2030.
He said Suzlon was of the view that South Africa could install at least 10 000 MW of wind power by 2020, creating at least 20 000 direct jobs and 200 000 indirect jobs. He put the country’s total wind resource potential at 30 000 MW, which could provide electricity to 7m homes, and was more than two-thirds of the current installed capacity.
There was an opportunity for South African manufacturing of components of the 200 wind turbines to be supplied to the Cookhouse project, such as towers. But the scale of local production would depend on how quickly projects were commissioned, he said.
The Cookhouse project was at “quite an advanced stage”, he said, indicating that it could be completed within 12 to 15 months from conclusion of a power purchase agreement.
The Cookhouse project, described by ACED managing director Thomas Donnelly as its “flagship South African project”, is among those to have received a positive record of decision from the Department of Environmental Affairs.
Former City Power head Silas Zimu, who is Suzlon’s chief executive in South Africa, referred to Cookhouse as “arguably the lead project in South Africa in terms of quality and development timelines”. Some wind developers expressed concern last month that certain wind farms had been pre-approved as a moratorium on environmental impact assessments had been lifted on only a select few sites.
ACED has appointed Standard Bank and Nedbank to finalise a financing package that includes a significant portion of broad-based black economic empowerment ownership.