Gov’t doubles Mmadinare solar contract to 120MW
Mbongeni Mguni | Monday December 25, 2023 06:00
The original 60MW plant, to be built between Selebi-Phikwe and Mmadinare by June 2024, was the largest renewable procurement signed off by government. Government and Scatec officials signed a binding 25-year Power Purchase Agreement (PPA) in August 2022 in Gaborone.
Under the deal, Scatec will finance, develop, and operate the solar power station, with the Botswana Power Corporation purchasing the generation.
This week, Scatec officials revealed that government had requested additional generation capacity.
“In the third quarter 2023, Scatec was awarded a 60MW expansion to the project, taking the total capacity to 120MW,” officials stated in an update.
The increase in requested generation awarded to Scatec mirrors the arrangement government sealed in July with Indian mega-firm, Jindal, for the doubling of a coal-fired power project to 600MW. At the time, Minerals and Energy minister, Lefoko Moagi, told this publication that government had been revising its Integrated Resource Plan and had noted an opportunity to go for the 600MW rather than the 300MW, given Jindal’s proven capacity in such projects.
He said since the procurement had already been done for the 300MW, the ministry had gone to Cabinet to seek an additional 300MW so that “it ties into the procurement that’s already there, going straight to Jindal rather than another procurement process”. With global funding of coal drying up, Moagi said government saw an opportunity to tap into the available funding and build a larger project.
Scatec, meanwhile, has already secured funding for the first 60MW from Rand Merchant Bank in Botswana and the World Bank's International Finance Corporation. Finance for the expanded generation will be through non-recourse debt and equity from Scatec, officials said.
“As we reach another milestone in our renewable energy journey in Botswana, we are now looking forward to starting construction of the largest solar project in the country,” said Scatec CEO, Terje Pilskog in a statement. “By doubling the total capacity of the solar power plant, we demonstrate the effectiveness of our strategy, robust business model, and drive to contribute to the green energy transition in Africa.”
Scatec estimates that the solar power plant will ensure that approximately 48,000 tonnes of CO2 emissions will be avoided and power provided to about 20,000 households annually.
Scatec is one of the world’s biggest solar and renewable energy developers, with large-scale projects that include a R16 billion plant in South Africa due to have a capacity of 540MW. In Africa, the group also has projects in Lesotho, Egypt, Uganda, Mozambique, Rwanda, and Tunisia.