Shumba secures partners for solar power tender
Brian Benza | Thursday January 7, 2016 14:29
Last year, the Ministry of Minerals, Energy and Water Resources issued a request for Expression of Interest (EOI) to construct, operate, maintain and decommission at the end of its economic life, a scalable solar power plant. The plant is earmarked to meet electricity needs for Jwaneng, mines in the North West region and surrounding areas.
In response to the request for an EOI, Shumba Energy says after having identified opportunities to develop solar PV power plants in Botswana, it partnered with co – developers, namely Mulilo, SunPower and Total.
“The developers will form a special purpose vehicle which will own, operate and maintain the proposed PV project assets. Mulilo will assist the local partner and lead developer (Shumba Energy) with site identification, the project structure, managing environmental impact assessments, arranging finance and compiling the bid response. Total would mainly be involved in raising finance with SunPower acting as EPC and Operation & Maintenance contractor,” said Shumba in a business activity report for the first half of 2016.
The developers roped in by Shumba have a combined installed renewable energy capacity in excess of 2000 MW, with more than 420 MW allocated under the South African Renewable Energy Independent Power Producer Procurement Programme.
Shumba says the developers will focus on optimising EPC costs, debt and equity in order to provide the most competitive tariff in the market. The solar power station forms part of a range of initiatives aimed at reducing the country’s dependence on fossil fuels and costly diesel-fired power stations.
Despite Botswana’s abundant solar resources, government has been reluctant to implement the project due to its high costs.
It is estimated that power from the solar station will attract tariffs as high as P2 per Kilowatt hour (KWH), double the 96 thebe the coal-fired power costs.
On the coal front, Shumba has lined up a number of activities in the first quarter of this year that will advance two of its energy projects in Botswana.
In the report, Shumba says it targets to receive a Power Station and Mine Environmental and Social Impact Assessment (“ESIA”) Authorisation for its Mabesekwa power station as well as finalise engineering procurement and construction contractor selection.
“The project is being developed to supply electricity to South Africa under the South African Coal Baseload IPP Programme for Cross Border Projects. The project is also Shortlisted in the Government of Botswana Greenfield Coal Baseload IPP Programme which will be a parallel bid submission,” said Shumba.
Mabesekwa will be a mine-mouth power plant using coal from a mining company in Botswana. For its Sechaba power station near Palapye, the company says it will submit an application for a mine and power station surface rights in the first quarter of the year.