South Africa’s Red Sands battery energy storage project (BESS) has achieved financial close
The 153MW/612 MWh project, led by Globeleq and African Rainbow Energy, becomes Africa’s largest standalone BESS facility to reach the financial close milestone.
It follows the signing of project agreements between both companies and the Department of Electricity and Energy and the National Transmission Company South Africa (NTCSA).
Globeleq and African Rainbow Energy raised approximately around US$300mn in debt financing from Absa and Standard Bank.
Located near Upington in South Africa's Northern Cape, the Red Sands BESS will span approximately five hectares and supply electricity to NTCSA under a 15-year power purchase agreement.
The project includes significant upgrades to Eskom and NTCSA's grid infrastructure and will help ease transmission and distribution congestion in the region.
China Energy Engineering Corporation has been selected as the engineering and procurement contractor, with the BESS technology and long-term service agreement provided by Sungrow, a global leader in inverter and energy storage system solutions.
“Financial close on Red Sands BESS is a pivotal step in delivering Africa's largest standalone battery storage project,” said Globeleq's CEO Jonathan Hoffman.
"With strong backing from Absa and Standard Bank, and support from our public and private partners, we're advancing a more resilient, low-carbon power system.”
Johan Koorts, senior banker, resource and project finance at Absa, said the transaction demonstrates the bank’s commitment to Africa’s energy transition goals and will support the reliability and efficiency of electricity supply in South Africa.
Sherrill Byrne, head of project finance, energy and infrastructure at Standard Bank CIB, added: “This project is set to significantly enhance South Africa's energy requirements and contribute to grid stabilisation."
Globeleq, which led the development and financing process, will manage the project during construction and into operation through a subsidiary, Globeleq South Africa Management Services.
The project was originally developed by African Green Ventures and later acquired by Globeleq in 2023.
Red Sands BESS will be its second utility scale BESS in its renewable portfolio, adding to its 13 solar, wind and hybrid PV plus BESS plants in South Africa, Mozambique, Kenya and Egypt, plus the Menengai geothermal plant, currently under construction in Kenya.
Read more:
Globeleq advances Kenya Menegai geothermal
Globeleq to support Zambia hydro project
Gllobeleq signs up Sungrow for Red Sands project