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- The Department of Mineral Resources and Energy has completed a refinancing agreement with an independent power producer.
- This can help lower electricity prices, the department said in a statement.
- The refinancing initiative was launched last year, as a means for independent power producers to move from bidding windows 1 to 3.5 to lower the wholesale price of electricity.
The Department of Mineral Resources and Energy was able to complete its first refinancing agreement with an Independent Power Producer (IPP), which is part of an initiative to reduce electricity rates.
The department released a statement on Monday in which it announced that it had concluded a refinancing agreement with ACWA Power’s Solafrica Bokpoort concentrated solar power plant (CSP). It is part of a refinancing initiative launched by the department in October 2019. All the IPPs (64 projects) from bid windows 1 to 3.5 were invited to participate in the initiative, with the aim of reducing the wholesale price of electricity .
Eskom has signed purchase agreements with IPP, but these agreements have been criticized in the past by the unions for being costly for the energy company.
This particular agreement with Bokpoort CSP will result in a 3.2% reduction in the IPP fee charged to Eskom, according to the department.
The department said that through the IPP Office, it is considering and seeing more refinance applications.
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