Four independent power producer investors and South Africa’s utility company, Eskom, have agreed to a commercial lease and land use agreement in order to develop clean energy projects.
For a period of 25 to 30 years, the investors will lease 6,184 hectares of land, adding an estimated 2,000 MW to the country’s electricity grid.
The land leases will attract an estimated investment of some 40 billion rands ($2.18 billion) to areas traditionally associated with coal-fired electricity generation, focusing on energy transition to a lower carbon economy, said Eskom CEO André de Ruyter.
These lease agreements come after Eskom issued a request for proposals in April. The successful bidders are HDF Energy South Africa, Red Rocket SA, Sola Group and Mainstream Renewable Power Developments South Africa.
The bids were three times oversubscribed, demonstrating investor demand for land with a grid connection and indicating that additional land parcels will be given favorable consideration, the company said.
In order to facilitate and hasten the investment in new renewable generation capacity, Eskom will be announcing new tenders for additional land parcels every three months.
