US-based titanium products provider Tronox has agreed to buy electricity for mines and smelters in South Africa from 200MW of solar capacity operated by Cape Town-based renewable energy developer Sola Group.
The electricity will be supplied to Tronox through wheeling agreements, which will see South African state-owned utility Eskom paid for the maintenance and upkeep of its infrastructure to transport the energy. The planned capacity should be fully operational by the fourth quarter of 2023.
“The projects will be majority-owned and operated by Sola Group and will deliver around 540GWh of energy to five mining operations through long-term power purchase agreements. The developments make use of the government’s recent relaxation of licensing requirements which exempt projects up to 100MW in size from requiring a generation license,” the company said in a statement, referring to the South African government's recent decision of raising the threshold for distributed generation to 100MW.
Through these provisions, renewable energy developers are exempt from applying for a license but they will be required to register with the National Energy Regulator of South Africa (Nersa). The measure is aimed to reduce dependence on Eskom for power supply. The troubled utility, which is currently unable to meet the country's power demand due to financial and operational issues, recently began considering renewables for its plant portfolio.
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