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NOA helps Tronox decarbonise its South African operations with 25-yr energy supply agreement

NOA Trading CEO Andrew Taylor

NOA Trading CEO Andrew Taylor

6th June 2024

By: Sabrina Jardim

Creamer Media Online Writer

     

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Local integrated energy company NOA Group Holdings has entered into a 25-year energy supply agreement with NYSE-listed titanium dioxide pigment manufacturer Tronox Holdings for its South African operating sites.

Under the terms of the agreement, NOA will supply Tronox’s operations in KwaZulu-Natal and the Western Cape with 497 GWh of renewable energy.

NOA says this agreement, which significantly extends Tronox's renewable-energy penetration to above 70% of its electricity requirements, underscores NOA’s model of aggregating power from a fleet of generation facilities across the country, for supply to its customers.

This is facilitated by State-owned energy utility Eskom's wheeling model, which allows NOA to source energy from diverse wind and solar facilities nationwide, thus enhancing supply reliability and tailoring generation profiles to specific geographic and resource characteristics.

“This model represents an advancement in renewable energy supply solutions for commercial and industrial offtakers in South Africa, representing the largest private wheeling transaction between an aggregator like NOA and a private offtaker.

“It separates energy generation from consumption using NOA’s aggregation and trading platform, unlike traditional bilateral agreements tied to specific generation sites. This ensures more flexible, efficient and reliable energy supply,” says NOA subsidiary NOA Trading CEO Andrew Taylor.

He adds that this initiative has been bolstered by the issuance of verified International Renewable Energy Certificates, which authenticate the delivery of renewable energy.

“This is pivotal in supporting Tronox's ambitious decarbonisation goals and reducing its reliance on fossil fuel-derived energy,” says Taylor.

Meanwhile, NOA says it is leveraging significant equity investment to solidify its position in the renewable-energy market and create strategic partnerships with established companies.

With R3.2-billion of equity capital committed by NOA’s majority shareholder, Africa Infrastructure Investment Managers, NOA says it is positioned as a reliable supplier of renewable energy to the South African market.

“This transaction with a blue-chip offtaker like Tronox is viewed as a flywheel deal, enhancing NOA’s strategic standing and capabilities in the sector.

“The agreement between NOA and Tronox, building on an initial renewable energy procurement [contract] in March 2022 . . . solidifies Tronox’s leadership in decarbonisation.

“By doubling down on efforts to reduce operational costs and accelerate its decarbonisation path, Tronox is aligning with the industry-wide move towards lower-carbon operations,” says NOA.

In South Africa, Tronox mines and beneficiates heavy minerals to produce titanium dioxide feedstock, zircon, rutile and high-purity products. Its KZN Sands operations, which comprises the Fairbreeze mine and central processing complex, is situated in Empangeni, in KwaZulu-Natal.

Its Namakwa Sands operation, in the Western Cape, comprises an openpit mine and concentration plant.

Tronox has set a target to reduce the Scope 1 and 2 emissions of its operations, globally, by 35% by 2025, by 50% by 2030 and to become carbon-neutral by 2050.

“Tronox’s solar and wind renewable energy agreements with SOLA and NOA will reduce our global Scope 1 and 2 greenhouse-gas emissions by 25% compared to our 2019 baseline, marking significant progress on our decarbonisation roadmap towards net zero carbon emissions,” says Tronox chief sustainability officer and head of investor relations Jennifer Guenther.

"Decarbonisation is critical for mining and industrial companies taking aim at net-zero targets. For Tronox, achieving this goal is largely facilitated by increasing the use of renewable energy as this latest agreement facilitates an annual offset of over 500 000 t of carbon," Taylor concludes.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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