Teraco gets grid capacity from Eskom for its solar power plant

  • Teraco has been given capacity on the national grid allowing the firm to break ground on a solar power plant in the Free State.
  • Power generated at the solar power plant will be wheeled to Teraco facilities via Eskom’s network.
  • Once complete the solar power plant is expected to generate 338 000MWh of energy every year.

The uncomfortable fact of doing business in South Africa is that a company needs to build resilience against loadshedding. With Eskom seemingly unable to keep a handle on its infrastructure, businesses need to be prepared to keep the lights on if loadshedding peaks.

One such company is Teraco which operates an interconnection hub and vendor neutral data centres. If the power goes out at one of Teraco’s facilities, it could be a calamity for the businesses that use digital services.

To combat this, Teraco has announced that it has secured its first grid capacity allocation from Eskom. With this allocation, Teraco will construct a 120MW solar power facility in the Free State and the energy generated from this facility will be wheeled through Eskom’s infrastructure to Teraco’s facilities.

“This allocation is a significant step towards meeting our renewable energy ambitions and those of our clients. It is also only the first phase of our longer-term renewable energy commitment. We have been on a long journey over the last few years to obtain these approvals, and our aim now is to execute quickly on the opportunity,” says Jan Hnizdo, chief executive officer at Teraco.

The firm says it intends to commence construction of this power plant as soon as possible. Once complete the solar plant is expected to generate over 338 000MWh annually. The plant will be constructed in partnership with JUWI Renewable Energies South Africa as well as Subsolar.

Teraco reportedly raids a “green loan” to finance the construction of the plant. A green loan is defined by the World Bank as “a form of financing that enables borrowers to use the proceeds to exclusively fund projects that make a substantial contribution to an environmental objective.

In 2022, Teraco raised a R1.5 billion green loan with a view to applying these funds to its 200MW utility scale solar programme.

“In South Africa, we have various energy challenges, and this presents an incredible opportunity to meet our near-term renewable energy goals while adding additional power capacity to a generation constrained grid. This will be a unique approach in Africa since Teraco will not only own its data centre facilities but also a significant renewable energy source with which to power them, creating a sustainable energy path to support growth. This initiative aligns with Teraco’s long-term vision of powering the digital transformation across Africa. South Africa’s solar resource is a source of competitive advantage for data centres relative to other location,” Teraco’s CEO added.

While it’s great that Teraco has secured grid capacity, it should be noted that the national grid is nearly at capacity. This problem exists in other parts of the world as well but with South African needing to urgently address the energy crisis, a grid that’s near to capacity is bad news.

We’d love to see more news like this, but the fact of the matter is that Eskom and government need to work harder to solve the energy crisis so that firms like Teraco don’t need to invest billions just to keep their services chugging along.


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