Eskom selects 18 companies to use its vacant land for renewable energy projects

Eskom has selected 18 companies who will be allowed to lease the power utility’s vacant land for renewable energy projects, which would feed into its energy grid.

Eskom opened the bidding process for access to the vacant land it owns earlier this year, to ramp up renewable energy capacity in the country, and just months later, the preferred companies have been selected.

These companies will have direct access to the national grid, with the lease expected to stay in place for at least 20 years.

The land lease agreements will be concluded on a commercial basis, with Eskom earning some income from the lease of the land, while the projects will enter into sale agreements for the electricity with third parties.

According to the power utility, no contracts have been signed yet as the companies must first obtain environmental impact assessment clearance.

The companies cannot be named either as no contracts have been signed.

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The current bids cover about 4,000 hectares (ha) out of the total 36,000 ha available under the program. The current projects will bring online a total of 1 800MW generation capacity once connected.

“We hope to sign the land lease agreements with the successful bidders by August,” said Eskom chief executive Andrè de Ruyter.

“This shows what can be achieved with reduced red tape and the impact of the liberalisation of the energy sector. This additional capacity will be added to the grid without any cost to the taxpayer.”

Eskom will make an announcement of the successful companies once all the processes have been finalised.

In the meantime, Eskom’s Reliability Maintenance Recovery (RMR) Programme is not yielding the necessary results. Only 47 of 84 projects were completed in the previous financial year, with many being deferred due to lack of funds and operational challenges. 

Additional reporting by Moneyweb