KHI SOLAR ONE TOWER PROJECT

Promoter – Financial Intermediary

The project promoter is a private Spanish multinational company that applies innovative technology solutions for sustainable development in the energy and environment sectors, generating electricity from the sun, producing biofuels, desalinating sea water and recycling industrial waste. The promoter is a market leader in most of these sectors, has an extensive track record and an international presence in over 70 countries across all continents. A South African pre-eminent development finance institution, whose role is to foster private sector development in South Africa, will jointly sponsor the project.

Location

• South Africa

Description

Construction and operation of a greenfield solar power tower with a 50 MW net power-generating capacity.

Objectives

Khi Solar One is a 50 MW steam receiver power tower concentrated solar power (CSP) plant with approximately two hours of steam storage and will have an overhead tie-line connection to the grid. The project will be located approximately 15 km south-west of the town of Upington in the Northern Cape province in South Africa.

Comments

This operation is covered by the EU Political Risk Guarantee for EIB loans outside the EU.

Sector(s)

• Energy

Proposed EIB finance (Approximate amount)

EUR 50 million

Total cost (Approximate amount)

EUR 332 million

Environmental aspects

If the project were located in the EU, it would fall under Annex II of the EIA Directive (85/337/EEC) as amended, requiring the competent national authority to determine the need for an Environmental Impact Assessment (EIA). Under South African Law, the project requires a mandatory EIA including initial scoping and public consultation. During appraisal, the Bank will ensure that the project complies with the Bank's principles and standards as regards environmental and social issues.

Procurement

The project has followed private procurement rules and the main contractors and suppliers have already been selected. However, the South African power sector is not liberalised and access to the electricity market is only possible through specific tendering procedures. The Bank will appraise the procurement process followed to confirm compliance with the Bank's Guide to Procurement.

Status

Signed - 5/11/2012