Energy company Cennergi, the joint venture between Exxaro Resources and Tata Power, reports that it has achieved financial closure on two Eastern Cape wind-farm projects with a combined investment value of R7-billion.

The Amakhala Emoyeni and Tsitsikamma Community wind developments will have a combined nameplate capacity of 229 MW and should begin commerical operations in 2016.

They were named as preferred projects by the Department of Energy (DoE) in May last year, following the second Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) bid window. The two large-scale projects comprise 35% of the second-round wind allocation.

Through the REIPPPP, the DoE aims to procure an initial 3 625 MW of large-scale renewables capacity and has, to date, allocated 2 460 MW across 47 wind, solar and minihydro projects. The third bid-window will close on August 19, 2013, and the next set of preferred projects should be unveiled on October 29.

In May, Cennergi concluded power purchase and implementation agreements for the two projects, which will be funded through a combination of equity and debt.

Exxaro and Tata Power are set to invest R1.8-billion in the projects, with the balance of the funding secured from various lenders, including Standard Bank, the International Finance Corporation and Nedbank Capital.

In addition, the Cookhouse and Bedford Community Trusts will together own 5% of the equity in the Amakhala Emoyeni project, while Watt Energy and the Tsitsikamma Development Trust will own 25% of the Tsitsikamma Community project.

The 134 MW Amakhala Emoyeni wind farm will be constructed near Bedford, in the Eastern Cape, and will comprise 56 Nordex turbines.

The 95 MW Tsitsikamma Community wind farm will be built near Clarkson, also in the Eastern Cape, and will comprise 31 turbines supplied by Vestas.

Exxaro CEO Sipho Nkosi says the projects are laying the foundation for Cennergi to become Southern Africa’s leading independent power producer. The company is also pursuing solar and coal-fired power projects in South Africa and in the region.