Sibanye-Stillwater, a mining group, has successfully finalized its first power purchase agreement (PPA) and achieved financial close for an 89MW wind farm in South Africa. The wind farm, known as the Castle Wind Farm, is strategically located near the town of De Aar in the Northern Cape province. Through a wheeling agreement with Eskom, South Africa's state-owned electricity utility, the wind farm will supply renewable energy to Sibanye-Stillwater's mining operations in the country.
The construction of the Castle Wind Farm is set to commence in June 2023, with commercial operation expected to begin in early 2025. The project consortium responsible for this renewable energy venture includes African Infrastructure Investment Managers (AIIM) and Reatile Renewables. AIIM, operating through its renewable energy project development and delivery platform called African Clean Energy Developments (ACED), has invested in the project through its IDEAS Fund, which is one of South Africa's largest domestic infrastructure equity funds. Rand Merchant Bank (RMB), a division of FirstRand Bank Limited, has been appointed as the sole mandated lead arranger for the project.
According to the terms of the 15-year PPA, the Castle Wind Farm will be financed, constructed, and operated by the consortium. This agreement marks a significant milestone for Sibanye-Stillwater, as it represents the first major step in achieving its ambitious renewable project portfolio of over 550MW. The company aims to achieve carbon neutrality by 2040.
Neal Froneman, the Chief Executive of Sibanye-Stillwater, expressed his satisfaction with the development, stating, “This project is a crucial part of our commitment to reducing carbon emissions and addressing climate change. Not only will it provide substantial cost savings on electricity and enhance energy security for our South African operations, but it will also contribute to tackling the electricity challenges facing the country. We eagerly anticipate the successful implementation of this project.”
The Castle Wind Farm is expected to have a positive impact on carbon emissions reduction, climate change mitigation, and the energy landscape in South Africa. It represents a significant stride towards a greener future and emphasizes the growing importance of renewable energy sources in the country's overall energy mix.
