Scatec ASA, a renewable energy provider, has achieved financial close for the Mogobe battery energy storage system (BESS) facility in Northern Cape, South Africa. The facility has been awarded a 15-year power purchase agreement under the first window of the Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP), allowing Scatec to receive payments for making the storage capacity available to the National Transmission Company of South Africa (NTCSA).
Roar Haugland, EVP for sub-Saharan Africa at Scatec, stated, “We are demonstrating that dispatchable energy and grid infrastructure are essential for the sustainability of South Africa’s current and future energy system. By unlocking more grid capacity, we are enabling increased electricity access and facilitating more renewable energy connections in the coming years.”
With a total capital expenditure of $170 million for the 103MW / 412MWh project, approximately 83% of the budget is allocated to Scatec’s EPC contract. The project will provide NTCSA with the capacity needed to balance the grid, financed by $154 million of non-recourse project debt, with Standard Bank of South Africa serving as the mandated lead arranger, while the remaining equity will come from the owners.
Scatec CEO Terje Pilskog remarked, “This marks a new milestone for Scatec in South Africa and for the country’s renewable energy transition. The Mogobe BESS project is a first of its kind and reaffirms our position as a leading renewable energy player in South Africa. We continue to identify attractive growth opportunities in the market, driven by the demand for increased power generation and supported by our strong local team.”
Rentia van Tonder, head of power corporate and investment banking at Standard Bank of South Africa, added, “Standard Bank is proud to continue our long-standing partnership with Scatec as the lead arranger for the groundbreaking Mogobe BESS project. This facility represents a significant advancement in South Africa’s energy transition and builds on our successful collaboration on projects like Kenhardt. We are committed to financing innovative energy solutions that promote sustainable development and economic growth in South Africa and across the continent.”
This development towards a sustainable future for South Africa is particularly timely, as IRENA recently warned that the world is at risk of missing a key climate target without immediate action.
