Abengoa's Solar Project in South Africa Attracts $142 Million AfDB Loan

Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--South Africa's Northern Cape province has one of the highest solar irradiation levels in the world and continues to attract a growing pipeline of solar power projects. One of the latest is the $980 million, 100-megawatt (MW) concentrating solar power (CSP) facility to be built by Abengoa (NASDAQ:ABGB) (Seville, Spain).

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The project will be part of the second round of the South African government's renewable energy program for independent power producers (REIPPP), which targets the construction of 17,800 MW of renewable power sources by 2030.

The African Development Bank (AfDB) has approved a $142 million loan to support funding of the project, saying that it would play an important role by providing much-needed long-term finance, enforcing environmental and social standards and working to enhance the development impact of the project.

Abengoa has another two solar projects under construction in the Northern Cape. A 100-MW parabolic trough solar plant, KaXu Solar One, is being built near the town of Poffadder, and there is a 50-MW solar plant being built near Upington on the Orange River.

The new plant, Xina Solar One, will be built adjacent to KaXu Solar One, and the two plants will form the largest solar complex in Africa, according to Abengoa. Xina Solar One will mitigate carbon emissions of 315,000 tons annually and produce enough clean energy for 90,000 households.

The project will use parabolic-shaped mirrors that can track the movement of the sun and concentrate solar radiation onto a receiving tube. Inside the tube, a heat-absorbing fluid will flow and reach high temperatures. This fluid transfers the thermal energy to a heat exchanger and is used to heat water and produce steam, which drives a turbine to produce electricity.

The Xina Solar facility will incorporate a five-hour thermal storage system that will use a set of thermal storage tanks filled with molten salts. This will allow the plant to generate electricity after sunset or during cloudy periods in the day. It also will adapt energy production to peaks in demand.

Abengoa said the construction, operation and maintenance of the plant will stimulate regional socio-economic development by creating numerous direct and indirect jobs, as well as a supply chain that will foster economic growth in the country.

The project will be funded jointly by AfDB, three of South Africa's commercial banks and development finance organizations.

For related information, see February 13, 2014, article--SunPower to Invest $200 Million in South Africa Project.

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