Ekurhuleni solar plant at Springs will supply the city for 20 years

BluEnergy, the electricity business of JSE-listed Blu Label Unlimited, and its development partner IBS Crafts have broken ground on a 25.6MW solar plant costing R360 million at the Springs Fresh Produce Market, and the plant will sell its power to the City of Ekurhuleni under a 20-year power purchase agreement.

Solar panels will go on the roof of the Springs Fresh Produce Market and across the unused land around it, feeding the Springs bulk substation, after Electricity and Energy Minister Kgosientsho Ramokgopa and Ekurhuleni executive mayor Nkosindiphile Xhakaza turned the first sod for the solar plant last week.

The 25.6MW plant is expected to generate about 40GWh a year, roughly what 6,000 average households use, and the city will buy that power for 20 years without contributing capital, because the independent power producer is funding the R360 million cost.

Olympia Park, a company in which BluEnergy holds the majority alongside IBS Crafts, will own and operate the plant, and IBS Crafts was chosen as preferred bidder under the Ekurhuleni Independent Power Producer Programme. Construction is expected to create more than 100 jobs, with operations and maintenance roles to follow over the plant’s life.

Ramokgopa announced on 19 October that the city’s application for a ministerial determination under section 34 of the Electricity Regulation Act had been approved, allowing Ekurhuleni to procure up to 2,400MW from independent power producers. Of that, 1,237MW is solar, including 1,137MW of embedded generation inside the municipality, and the city expects the programme to save about R36 billion in bulk electricity costs over 20 years.

Springs is the first project in Blu Label’s 180MW pipeline to enter construction, with power expected in the fourth quarter of 2027, and the group’s Cigicell business already supplies prepaid electricity vending systems to more than 95 municipalities. “Springs puts this group strategy into practice,” said Mark Levy, Blu Label’s joint chief executive.

BluEnergy Trading received a multi-year electricity trading licence from the National Energy Regulator of South Africa earlier this year, and Aaron Suckerman, BluEnergy’s chief executive, called Springs “a flagship project for BluEnergy and a blueprint for municipal energy partnerships in South Africa”.

Images: Business Insider Africa