City of Cape Town signs solar power deals for electricity up to 21 percent cheaper than Eskom

The City of Cape Town has concluded its first agreements to purchase electricity directly from independent solar producers, with costs anticipated to be between 19% and 21% lower than Eskom's rates. These 20-year contracts will provide 70MW of solar power from facilities in Atlantis and Philippi as the city aims to lessen its dependency on Eskom.

Mayor Geordin Hill-Lewis announced that the agreements represent a crucial step towards ensuring more affordable and dependable electricity for residents. He emphasized that families cannot have to bear perpetual Eskom price increases indefinitely, hence the city's efforts to break free from expensive Eskom power to make electricity more budget-friendly for Capetonians.

Hill-Lewis added that they are delighted to have sealed the initial two power purchase agreements with solar plants in Cape Town, marking a first for any South African city, and plans to acquire up to 700MW of independent power over time. The agreements secure 30MW from JEMPEC's solar plant in Atlantis and an additional 40MW from Make a Difference LLC's Solar plant in Philippi.

Under these agreements, annual price hikes will be tied to the Consumer Price Index rather than future Eskom prices. Mayoral Committee Member for Energy, Xanthea Limberg, highlighted that the agreements will also circumvent nearly two million tonnes of carbon emissions, earning the city carbon credits that can be traded on the open market to generate funds for additional infrastructure investment.

Cape Town has already earned R36 million in carbon credits through municipal waste-to-energy projects that reduce gas emissions at landfill sites. These two solar agreements signify the beginning of a much larger independent power program, with the city planning to eventually purchase up to 700MW from private producers.