Steelmaker ArcelorMittal South Africa (AMSA) is planning to start construction on a 200 MW solar photovoltaic (PV) power plant at its Vanderbijlpark facility, in Gauteng, towards the end of the year, CEO Kobus Verster has told Engineering News & Mining Weekly.

He explained that the installation would serve as one of AMSA’s first steps towards decarbonising the company’s energy requirements.

So far, the project has been put out on tender, with numerous tenders having been received. These are currently under adjudication. Subject to State-owned Eskom’s grid-connection approval processes, construction will start thereafter.

Verster said on April 30 that he expects construction of the plant to start early next year at the latest, if the Eskom approval process takes longer than expected.

“We have all the permitting required. We have our environmental approval. We have the local authority approvals. We have everything except the Eskom connection,” AMSA CTO Werner Venter explained.

He said the solar PV plant would supply about 43% of the Vanderbijlpark facility’s energy demand and contribute about 23% to AMSA’s overall energy requirements on a standalone basis. The associated carbon emissions reduction attributed to the use of the solar plant would amount to about 540 000 t/y.

“It’s quite a reasonably big impact on our energy costs and also dependence on Eskom,” he commented.

Following the construction of the plant, Verster said there were plans to enter into power purchase agreements to acquire clean energy from other sites, as well as to generate additional electricity from gas and steam generated on site.

Venter noted that the indicative project cost was in line with benchmarked investments and that AMSA would obtain the exact project structure and funding approvals once the grid connection approvals through Eskom were finalised.

“We are also just sorting out the financing between us and the [ArcelorMittal] group. So it will be built with our own financing between us and the group,” Venter explained.

He further noted that the power plant would not feature any electricity storage solutions, owing to the fact that it was expected that the plant would consistently fully use whatever electricity was generated during the day.

In addition, the fact that the Vanderbijlpark facility’s electricity use curve is relatively flat means it is easy to predict demand, thereby making batteries unnecessary.

“We have a lot of land around our facilities . . . [and] we can build renewable facilities next to our plants, supply the energy directly to our facilities and connect it on our property,” Venter concluded.