Speech by Terje Pilskog, CEO, Scatec, at the commemoration event at Scatec, Kenhardt site in Northern Cape.
“It is with great pleasure and immense pride, that I stand before you here to celebrate the inauguration of the Kenhardt hybrid solar and battery storage project. I would like to tell you more about the journey that brought us here. It is a journey where we have all played an important role, Scatec, our partners, financing institutions, the local communities and South Africa working together.
It has been a long journey, defined by pioneers, changemakers, partnerships, predictability, responsibility and long-term perspectives. I believe you will agree with me, about the true importance and significance these traits have played through this journey.
Firstly, we celebrate the strong, and responsible performance of our project team. They have done something that has not been done before. The sheer size of Kenhardt is impressive and difficult to grasp. With 540MW solar capacity and 225MW of batteries with 1.1GWh of storage capacity, the project is one of the largest hybrid projects globally. The site spans 879 hectares, over 1 500 football fields, and is 10km from North to South. It consists of about 1-million solar panels and 45 640-foot containers of batteries, each weighing 30 tons as well as 9 000km of cables, representing the distance between Norway and South Africa.
At peak construction the site employed 2 600 workers. Most of the workers have been local and a large share of them have been women. This is one of several ways the project contributes to local social and economic development. The project has been built according to schedule, in 18 months, with good health and safety records throughout the construction. This is a world-leading construction timeline for a project of this scale.
To Jaco Uys and the rest of the project team and our construction and technology partners, Congratulations! Thank you for your dedication and hard work over the last 18 months.
Talking about the long journey ….
South Africa has been a pioneer and changemaker in the renewable energy sector. The Renewable Energy IPP Procurement Programme was launched back in 2010. Through this, you were an early mover in emerging markets and despite some bumps in the road, it has been a huge success and globally recognised as a model program. The predictability of the program is central to its long-term success and has increasingly attracted new entrants to the market and South Africa has now a vibrant renewable energy sector.
Scatec was successful in the first round of REIPPP program and we were the first company to bring a utility-scale project into operation with our 75MW Kalkbult project in 2013. Since then, we have developed and built about 1GW of solar projects in South Africa. This is home to our technical and operational competency centres, tracking our plants worldwide. And South Africa is indeed where the story of what Scatec is today started.
We started the development of Kenhardt project back in 2014, then targeting the REIPPP program. When RMIPPP was launched, we had already also permitted the project for batteries and saw an opportunity to participate. I have to say, there was some great foresight of our team here.
It was awarded under the RMIPP as the only 100% renewable project in a technology agnostic tender, competing against thermal energy sources. Not only that, but the project also reached financial close 18 months ahead of any other project from the RMIPP round and has now already been operating since late last year. There should no longer be any doubt about renewables’ ability to compete with fossil fuels in giving people stable access to energy. With Kenhardt, we prove that renewables are competitive not only on an intermittent basis but is also able to provide competitive power on a firm and baseload basis.
The Kenhardt project is a landmark project, unique from a global perspective. This innovative and large-scale project delivers 150MW of dispatchable power from 5am to 9.30pm year-round to the national grid under a 20-year power purchase agreement with Eskom.
Succeeding with such a flagship project is dependent on strong partnerships. Let me thus take this opportunity to thank our funding partners, H1 Holdings, Standard Bank, BII, Old Mutual, Norfund, EksFin and the IDC – all of you have helped this project become a reality.
I believe the Kenhardt project provides a glimpse into the future of renewable energy. South Africa is blessed with abundant solar and wind resources and a lot of available land. Renewable energy is generated at competitive costs, even in a global perspective. Therefore, renewables can address the energy trilemma of affordable, sustainable, and secure energy supply. And technology development and costs reductions are not stopping. Since we started building Kenhardt, the development has continued, and costs are coming further down.
Plants like Kenhardt significantly alleviate the power shortages currently experienced, highlighting the critical role of energy storage in SA’s road towards energy security, and the battle against the ongoing load shedding crisis.
But this is not just about generating power, it is also about a just energy transition. It’s about empowering and fostering sustainable growth. Our social licence to operate is at the core of our business model. To the local community, who have allowed us to build and operate this facility, we are grateful for the opportunity to build on our experience here in the Northern Cape and South Africa. Thousands of livelihoods have been positively impacted by the successful implementation of the project. Scatec is committed to fostering local economic growth, and facilitates skills- and knowledge transfer around the latest innovations in incipient energy storage technologies – a rapidly evolving field.
Access to stable electricity is an enabler for societies to grow and people to thrive. Competitive renewable energy is a requirement for the decarbonisation and future viability of many industries like fertilisers, aluminium, steel and so on. The future will be renewable and electric and green, competitive power will be a strong platform for economic growth.
The journey continues for Kenhardt, Scatec and South Africa …
As we inaugurate Kenhardt, a new phase begins. We are committed to continuing to deliver dispatchable renewable energy to Eskom for the next 25 years, maintain the project in top shape and be a positive contributor to the region and local communities.
For Scatec, South Africa continues to be a core market. We have big ambitions in the country, it is our largest market, and we aspire to continue to grow our presence here further.
For South Africa, the road to build our generation capacity and infrastructure and to succeed with a just energy transition continues. It is a journey that will take time, but we believe renewable energy can become a competitive advantage for South Africa and contribute to economic growth. And we believe South Africa can be a regional leader, driving renewable energy development on the continent.
Scatec looks forward to continuing this partnership with the South African government and with our other valued partners and stakeholders. Thank you all for your contributions and participation. Together we are improving our future.