Minister Ramokgopa Signs Agreements for Battery Energy Storage Projects in N Cape

The projects, developed by EDF International in partnership with Mulilo, Gibb-Crede, Pele Green Energy, and a community trust, are set to play a significant role in stabilizing the grid and integrating renewable energy sources across the country.

Dr Kgosientsho Ramokgopa, South Africa’s Minister of Electricity and Energy, has officially signed two key agreements marking the commercial closure of projects under the first Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP), Bid Window 1. These agreements pave the way for the development of two large-scale Battery Energy Storage Systems (BESS) in the Northern Cape Province, contributing a combined 360 MW/1440 MWh storage capacity to the national grid.

The projects, developed by EDF International in partnership with Mulilo, Gibb-Crede, Pele Green Energy, and a community trust, are set to play a significant role in stabilizing the grid and integrating renewable energy sources across the country.

Key Projects in Northern Cape

The two storage projects, Oasis Aggeneis and Oasis Nieuwehoop are strategically located at the Aggeneis Substation near Aggenys and the Nieuwehoop Substation close to Kenhardt, respectively. Oasis Aggeneis will provide 77 MW/308 MWh, while Oasis Nieuwehoop will contribute 103 MW/412 MWh, for a total capacity of 180 MW/720 MWh across both projects.

Construction for these projects is expected to begin shortly, with both sites aiming to come online by November 2026. The development is expected to attract an investment of approximately R4.7 billion, with 42.23% local entity participation and 40% Black Economic Empowerment (BEE) ownership across both projects.

Job Creation and Economic Impact

The Minister emphasized the substantial economic benefits of the two projects, which are expected to create 487 job opportunities (measured in job years) for South Africans. This includes 301 jobs during construction and 186 jobs during the operational phase. In addition, the projects have committed to spending 20% of total project costs on local content, ensuring that the local economy benefits from the construction and operational phases.

Furthermore, the projects have allocated R43 million over the next 15 years for social initiatives, including skills development, supplier development, bursaries for Black students, and enterprise development to uplift communities and promote long-term socio-economic growth.

Battery Energy Storage Systems (BESS): A Game-Changer for Grid Stability

The deployment of Battery Energy Storage Systems (BESS) is seen as a crucial element in South Africa’s energy future. These systems store excess energy during low-demand periods and release it during peak hours, improving grid stability and facilitating the integration of more renewable energy into the national grid.

BESS technology also provides ancillary services that are essential for the grid's system operator to maintain reliable electricity supply across the country. As part of the BESIPPPP, the focus is on enhancing energy security, reducing grid congestion, and optimizing the use of renewable resources.

Looking Ahead: Additional Projects and Bid Windows

Following the successful closure of these two projects, the Department of Electricity and Energy is progressing with further BESS developments. Bid Window 2 is currently in the evaluation phase, with an announcement expected in the coming weeks. Additionally, Bid Window 3 is in the planning stages, with submissions expected to follow soon after.

In March 2024, a fifth project was appointed and is set to reach commercial close in early 2025 following successful negotiations. The growing number of projects under the Battery Energy Storage Procurement Programme signals South Africa’s commitment to increasing energy capacity and transitioning to a more sustainable and resilient energy future.

Conclusion: A Step Towards Sustainable Energy

The signing of these agreements represents a significant milestone in South Africa’s energy transition journey, positioning the country to better handle the challenges of energy supply and demand. The BESS projects will not only enhance the reliability and stability of the national grid but also help meet socio-economic development goals by creating jobs and boosting local economies.

As South Africa works towards meeting its Nationally Determined Contributions (NDCs) under the Paris Agreement, these projects are integral to the country’s plans for a sustainable and equitable energy future.