At least 1,000 jobs will be created in Buffalo City Metro when a R1.3bn 60 megawatt solar energy plant is built in the small town of Berlin in 2019 to lift some pressure from the troubled Eskom power grid.
Construction of the photovoltaic power plant by independent power producer Thezi-Langa (Pty) Ltd is expected to start in July on a 233ha piece of land, and will be completed in 2020.
The mega-project was approved by BCM council last month after five years in the pipeline.
The company, working closely with the East London Industrial Development Zone (EL IDZ), is promising BCM ratepayers cheaper electricity and a massive revenue of R2.6bn for BCM over a period of 20 years.
Speaking to the Daily Dispatch on Friday, Thezi-Langa chief executive Patrick Nawa said: “This means the world to us as we have been working on this project for almost six years.
“We hope this is the first project that will unlock jobs for the people and open many other similar projects for the Eastern Cape province, as we all know it has high unemployment and a lot of potential.”
Nawa said the construction of the plant would take 18 months to complete.
“By December 2020 we should be done.
“We are going to fully energise the whole plant by then, so the residents should start using the electricity immediately.
“As we are building the plant we will be feeding the grid straight away after finishing every megawatt,” he said.
The 1,000 jobs will be mostly for civil and electrical works as roads, solar panels, inverter houses and cables will be built and installed.
On completion, an additional 50 jobs will be created for the operation and maintenance of the plant, he said.
“We are going to be selling electricity to BCM at a lower price than Eskom.
“The electricity tariff increases will not be as pricey as they currently are with Eskom.
“In SA, the Municipal Finance Management Act clearly states that if a municipality buys electricity from an independent power producer, they have to buy it at the same or a lesser price. But ours will be cheaper than Eskom,” he said.
His company had already secured external international funding for the project including funding from his business partners in China, he said.
The power purchase agreement approved by council is for 20 years.
BCM spokesperson Samkelo Ngwenya said: “[The project] will present residents with a wide variety of options, with the ultimate goal being to help ratepayers have a wider choice to use various forms of energy at an affordable price.”
At the council meeting last month, the DA opposed the deal.
DA councillor Bill Gould said council should be cautious when dealing with the matter as it was essentially a “procurement issue”.
“Council can accordingly not approve the unsolicited bid at this juncture nor can it approve a power purchasing agreement for a period of 20 years.
“While the DA acknowledges that it may hold benefits for the city, proper processes must be followed and if council approves the recommendations, the DA records dissent,” said Gould.
However, BCM mayor Xola Pakati defended the move and said the unsolicited bid was to provide a mechanism for the government to liberate private sector expertise for the benefit of the community.
“There is nothing untoward [about the bid],” Pakati said.
In his report, city manager Andile Sihlahla said the deal would have a number of economic benefits for BCM.
“Total project cost [is] estimated at R1.3bn,” Sihlahla said.
“BCM accumulated gross revenue from Thezi-Langa solar energy sales over the agreement period [is] estimated at R2.65bn.”
“The project’s local content contracts are estimated at R350m.”
ANC councillor Amanda Mnyute said in council: “It’s going to create jobs for our people. It’s good for us. This is what we want and this is what the people of Buffalo City have sent us to council to do, to better their lives.”
EL IDZ marketing and public relations officer Yandisa Msileni said: “We are excited at the new developments as they mark yet another milestone for the renewable energy sector in the region.”..