Seriti Resources and its renewable energy subsidiary, Seriti Green, have announced that Seriti Green will soon begin construction on South Africa’s largest wind farm in Mpumalanga, with power supply coming online by 2025. This follows the signing of heads of terms between Seriti Resources and Seriti Green to a Power Purchase Agreement (PPA) for 155 MW of power that will be generated by Seriti Green and wheeled through the national grid to Seriti Resources’ coal mining operations.
The PPA is a significant step in Seriti’s renewable energy plans and is a realisation of its commitments made in the MoU signed with Eskom and Exxaro in October 2021. Seriti Green is proud to partner with Standard Bank and RMB in the financing and development of this initial 155 MW facility with a capex cost of ZAR4 billion. The conclusion of the PPA and meeting of all conditions necessary to commence construction (including reaching a financial close on the project) is expected to be completed by Q2 2023. The project has already received its Environmental Authorisation from the Department of Forestry, Fisheries and the Environment, a critical requirement to start construction.
The 155 MW Wind Energy Facility is the first phase of a larger, ~900 MW renewable energy cluster called Ummbila Emoyeni located between Bethal and Morgenzon in Mpumalanga. Ummbila Emoyeni is a combination of 750 MW wind energy facilities and 150 MW solar PV plants. The entire project has been designated as a Strategic Integrated Project by the Department of Public Works and Infrastructure.
The signing of the PPA, and the development of this first wind farm, is a major first step in the construction of Seriti Green’s larger renewable energy project ambitions, to develop the capacity for 3,000 MW of renewable energy (both wind and solar) in the next decade.
The wind farm will be constructed in Mpumalanga, the country’s coal heartland, and will translate into a significant investment in the province along with the creation of jobs, procurement opportunities and social investment expenditure.
“The agreement is the first step in Seriti Resources’ journey towards carbon neutrality. More than that, the addition of 155 MW of renewable energy into the national grid in just two years will contribute to relieving Eskom’s energy constraints,” said Mike Teke, CEO of Seriti.
He notes that 155 MW could power approximately 165,000 average South African households per year. “It is fitting, we think, that this project will be developed in Mpumalanga, the home of coal mining and Seriti’s own operations. We are very mindful of the need for a just energy transition, where the needs of and responsibilities to those most immediately affected – employees, communities and beyond – are considered and planned for. This is just a first step for Seriti Green,” said Mike Teke.
The agreement is in line with the pledge Seriti Resources made in the MoU signed with Eskom and Exxaro, which outlined Seriti’s commitments to use renewable wind and solar energy in its facilities through the signing of PPA’s for the procurement of renewable energy. Under the MoU, Seriti aims to reduce its CO2 emissions by up to 350,000 t per annum, around half of its current emissions.
CEO of Seriti Green, Peter Venn, commented: “Climate change is a reality, and we are proud to be part of the solution to lowering carbon emissions through stable and cost- effective renewable energy through this momentous agreement.”
As a responsible coal producer, Seriti Resources is conscious of the effect that fossil fuels have on the environment and humanity – the company is therefore committed to playing an active role in reducing carbon emissions while helping to manage a just transition to a low-carbon future.
Once constructed the wind farm will transform over 75% of the energy consumption from Seriti’s existing coal operations into renewable energy whilst helping to mitigate its Scope 1 and 2 Greenhouse Gas (GHG) emissions and bringing the company a step closer to carbon neutrality. Scope 1 refers to emissions from processes at the mine site, while Scope 2 are the indirect emissions such as the purchase of electricity from Eskom.
Mike Teke said: “This agreement is a meaningful step that further cements the significance of the inclusion of renewable energy through Seriti Green into the Group’s existing portfolio of high-quality coal assets to lower its carbon footprint and ensure long- term sustainability as a diversified energy producer.”