The 128 MW Oya Energy hybrid project, which will combine variable renewables and batteries to produce dispatchable electricity daily between 5:00 and 21:30 for injection into South Africa’s loadshedding-prone grid, reached financial close on Tuesday, February 13.

The project was named as a preferred bidder for a 20-year power purchase agreement (PPA) under South Africa’s Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP), which was launched as a so-called emergency procurement round in 2020 for some 2 000 MW.

The bulk of the allocation was awarded to three powership projects at Coega, Richards Bay and Saldanha Bay, but these ran into immediate legal and environmental problems, which resulted in serious delays to the RMIPPPP as a whole.

In December, Eskom announced that the grid connection budget quotes for the three Karpowership projects, along with another hybrid project that included gas and batteries, had officially expired, finally releasing scarce grid capacity that had been reserved for the projects.

The expiry meant that only hybrid projects bid under the RMIPPPP – which many described as having been tailored for gas-to-power, given the dispatchable profile stipulated and a rule disallowing the hybrid projects from charging their batteries using the grid – eventually advanced to financial close, with three Scatec solar- battery projects having entered into commercial operation on December 11 last year.

The Oya Energy Hybrid Project, which will be developed on a single location on a site that spans the Western and Northern Cape provinces, between the towns of Ceres and Sutherland, combines 155 MW of solar photovoltaic and 86 MW of wind with a 92 MW/242 MWh lithium-ion battery energy storage system to produce the dispatchable electricity required under the power purchase agreement.

The power station will be jointly owned and operated by ENGIE (35%), G7 Renewable Energies (20%), Meadows Energy (22.5%) and Perpetua Investment Holdings (22.5%), with RMB having acted as the sole mandated lead arranger and bookrunner for the project.

ENGIE country manager Mohamed Hoosen described the project as “an innovative first-of-its-kind power solution”, while G7 CEO Dr Kilian Hagemann argued that it represented “the blueprint for a carbon neutral, 100% renewable future power grid”.

The project, the investment value for which has not been disclosed, falls within the Komsberg Renewable Energy Development Zone and will be constructed by a joint venture comprising Power Africa and SinoHydro.

It is scheduled to will reach commercial operation in the last quarter of 2025.