To expand its renewable energy offerings and meet rising corporate demand, Discovery Green — the electricity trading division of Discovery Group — has finalised its first power purchase agreement (PPA) as an off-taker for phase 2 of Red Rocket’s Overberg wind farm in the Western Cape.
Slated for full commercial operation in 2027, the project will supply 150MW of renewable energy to major industrial and commercial clients, including Impala Platinum’s mining operations and Fortress Real Estate Investments, through a wheeling model.
Phase 2 of the Overberg wind farm, 12km west of Swellendam, leverages SA’s national grid to transmit renewable electricity to off-site clients through a wheeling mechanism, bypassing geographical constraints.
Wheeling allows electricity generated at one location to be transported through Eskom’s existing transmission and distribution networks to end-users elsewhere in the country.
This process operates on a willing buyer/willing seller basis, where both the generator and the consumer pay connection fees to Eskom to facilitate the transmission.
The wheeling model, previously only accessible to intensive energy users such as Sasol, enables businesses to tap into renewable energy from remote wind and solar farms via Eskom’s infrastructure.
Discovery Green head Andre Nepgen said the deal supports the long-term strategy, which revolves around securing long-term power purchase agreements to promote renewable energy adoption among businesses.
“The partnership with Red Rocket, a well-established independent power producer with a strong track record in developing and managing power plants, fits squarely within this vision.
“During Discovery Green’s 2023 procurement round, Red Rocket emerged as a standout partner, making the Overberg wind farm project a natural fit,” said Nepgen.
In mid-May, Discovery Green launched a new product, Ampli Energy, teaming up with Sasol to offer SA businesses easy access to clean energy via the national grid.
The new product provides clean electricity to small and medium enterprises (SMEs), corporates and NGOs, where users are looking for flexible contracts and do not have to invest in renewable infrastructure.
Ampli Energy pays businesses cash back monthly to replace their electricity consumption with clean, grid-delivered renewable energy.
However, according to Nepgen, the new agreement with Red Rocket primarily benefits large energy users with predictable consumption patterns.
“These clients typically enter into long-term contracts, spanning five to 20 years, which provide price certainty and support their decarbonisation objectives.”
On the choice of wind or solar as a source of clean energy, Nepgen said it depended on the client’s needs.
“Businesses operating during daylight hours potentially prefer solar, while 24/7 operations, such as Implats’ mining activities, are better suited to wind energy.
“A balanced combination of both energy sources is essential to meet diverse demand profiles,” Nepgen said.
Backed by a total investment of more than R13bn, the Overberg wind farm phase 1 and 2 project is financed by a consortium of leading financial institutions, including Absa, Standard Bank and the Development Bank of Southern Africa.
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