Independent power producer Mainstream Renewable Power has reached financial close on the 27 MW Phase 2 extension of its Ilikwa solar project, near Parys, in the Free State.

Once complete, Phase 2 will take Ilikwa’s total capacity to 77 MW, up from the 50 MW delivered by Ilikwa Phase 1. Phase 1 reached commercial operation in July.

Ilikwa Phase 2 will supply power to multiple private commercial and industrial customers under shorter-term five- to ten-year power purchase agreements (PPAs).

Commercial operation of Ilikwa Phase 2 is targeted to start in the fourth quarter of 2027, at which point the full 77 MW Ilikwa solar project will be operational.

Further, a future Ilikwa utility-scale battery energy storage system is under consideration for 2027 to enhance services to customers, Mainstream adds.

“Reaching financial close on a further 27 MW at Ilikwa demonstrates the growing demand for flexible renewable energy solutions from private customers and Mainstream’s ability to scale these solutions to meet that demand,” says Mainstream South Africa GM Hein Reyneke.

Once fully operational, Ilikwa Phase 2 will produce about 75-million kilowatt-hours of electricity a year, while avoiding the release of an estimated 72 000 t/y of CO₂.

Construction of Phase 2 is expected to add to the employment and local economic opportunities generated during the construction of Phase 1, which created more than 2 600 employment opportunities at peak construction.

The majority of workers were recruited from the neighbouring communities of Tumahole, Schonkenville and Vredefort.

The project also supported local procurement and enterprise development during construction.

Ilikwa Phase 2 builds on the company’s record of taking private PPA renewable energy projects to financial close in South Africa.

Shorter-term PPAs open up South Africa’s private energy market to a wider range of businesses, giving them access to affordable, reliable and renewable power without the commitment of a traditional long-term PPA, the company says.

Mainstream offers shorter-term PPA’s through its own National Energy Regulator of South Africa-licensed electricity trading business.

Financial services firm Investec Bank is the financing partner on Phase 2 and will hold a 30% equity interest, alongside Mainstream’s 70% stake, which is the same ownership structure as Phase 1.

Commercial and industrial solar and storage system developer Terra Firma has been appointed as Mainstream’s engineering, procurement and construction (EPC) provider for the Ilikwa Phase 2 project.

South Africa’s energy transition is about building the energy system needed to power economic growth, industrial competitiveness and long-term resilience. This increasingly requires a diverse mix of sustainable energy solutions, including wheeled power, that provide energy users with choice and flexibility, Terra Firma says.

Its selection as EPC is also an important milestone for Terra Firma. After more than 14 years delivering over 400 MW of complex behind-the-meter energy solutions for commercial and industrial customers, the company brings engineering and delivery expertise to large-scale wheeling projects, it says.