Marondera (New Ziana)- De-Green Rhino Energy’s 50MW Marondera Solar Project, valued at US$65 million and to be to be constructed at Rufaro Farm, is set to take off next month in a development that has excited both the proprietors and funders.
The project will become the latest high impact project to be rolled out for the benefit of Mashonaland East and the nation at large after the US$1 billion Manhize iron and steel plant that is being rolled out by Tsingsan Mining Investments Zimbabwe.
It will also be a major boost for Mashonaland East’s provincial capital of Marondera in terms of investment as the ZESA Pension Fund mall being constructed along the Harare-Mutare highway is nearing completion and could open its doors to members of the public during the second quarter of the year.
The Marondera Solar Project which has been in the pipeline for the past few years is among a handful of projects that Finance Minister Professor Mthuli Ncube announced that will also benefit from the Government Implementation Agreement (GIA) in the long run late last year.
Three components make up the GIA and these are the Project Development Support Agreement (PDSA), Power Purchase Agreement (PPA) and the Reserve Bank of Zimbabwe (RBZ) Undertaking for Foreign Currency Convertibility and Transfer.
The guarantees will cushion solar power projects that have sizes ranging from 5MW to 100MW and a cumulative capacity of 998MW at a cost of $1 billion and will speed up the Independent Power Producers (IPPs) installations.
A government implementation agreement (GIA) sets out terms on which the Government provides incentives and assistance to the prospective partners. It also includes a project development support agreement, a power purchase agreement, and an agreement with the Reserve Bank of Zimbabwe (RBZ) for guaranteed payments of dividends and foreign loan repayments to external investors and lenders.
In an interview with this publication, De-Green Rhino Energy co-director Joachim Baumgartner who is based in the United Kingdom hailed the conducive environment that has been availed by the Second Republic led by President Mnangagwa.
“We are excited to announce that if everything goes according to plan, we will be starting the Marondera Solar Project and we thank the conducive environment that has been created by the Government. On our part, we have ensured that all necessary documentation is in place, and we are geared to set the ball rolling.
“As De-Green Rhino Energy, we recently signed the indicative term sheet, thus the financing contract, with our financiers. We are very much alive to the fact that Zimbabwe is aiming to achieve upper middle-income status by 2030, and the incentives are part of the plan as a diversified, reliable, and affordable electricity mix will be a key factor in achieving that goal.
Francis Gogwe who is also a co-director of De Green Rhino Energy expressed optimism about the project, saying its commencement will be a wonderful moment for the country’s energy sector.
“This is a wonderful moment for the energy sector in Zimbabwe. We are hopeful that following the introduction of this framework, we shall be able to contribute significantly to the national grid in terms of electricity production.
“We have been there for several years, working on developing Rufaro Solar Farm. We have all the approvals in place and have been tying loose ends in terms of funding. This development has excited even our investors. As I stated earlier on, what excites us the most is that Government introduced a framework that standardizes Power Purchase Agreements (PPA) together with the GIA. The documents are critical for the success of the energy sector. The PPA addresses the tariff which is a major area in the project development process while a cost-based tariff covers all the costs.
“The GIA which has now been attached to the framework will act as a guarantee for the project. At least, there will be a profit for the proprietors. In the event that the off takers fail to meet their obligations, the risk will be shouldered by the Government. In South Africa, they have a similar process, and it has been doing wonders for the country where investors have been stampeding to invest in the energy sector,” he said.
Gogwe further revealed that containers will be moved to the solar project site at Rufaro farm reiterated other benefits it will bring to Marondera and the nation at large.
He said: “We will be starting next month, and arrangements are already in place to move containers on site. Apart from contributing 50 mega-watts to the national grid, we will also create job opportunities for the people of Marondera and surrounding areas. This economic upward trajectory that Zimbabwe is in right now will be enhanced and Vision 2030 will be achieved.
“Besides electricity generation and constructing supporting infrastructural development, we will plough back to the community and there is a percentage of money that we have set aside for that. We will see what best we can do for community as part of our corporate-social responsibility. Roads leading to the plant will be widened.”
The solar power plant’s expected generation time is estimated to be 11-12 months from the start date if it were not for delays in the supply chain due to the COVID-19 pandemic that the world is battling with.
New Ziana
