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Climate Fund Managers (CFM) has announced a joint development agreement with local developer Energy Resources Senegal (ERS) to develop a 30MW solar PV plant and 15MW/45MWh battery storage system at Niakhar. Tendering for an engineering, procurement and construction contractor was launched in mid-November, CFM’s regional head Africa Sebastian Surie told African Energy.
Financial close is expected at the end of Q1 2021, with construction expected to take a year. The project will be funded by ERS and the CFM-managed Climate Investor One Construction Equity Fund. The estimated total cost is $55m, of which Climate Investor One is expected to provide about $40m. The project is anticipated to be Senegal’s first solar plant with a large battery component.
“Batteries in combination with solar projects are quite new to Africa, though we have seen several success stories in other parts of the world. The great benefit of batteries is that they can act as a stabiliser, making it much easier for grids to absorb the intermittent power of renewable energy projects. The battery solution will require a tailored design and careful management, since improper use may shorten the lifespan of the battery and can ultimately result in the cancellation of the supplier’s warranties. The key challenge for this project will therefore be to adequately capture the battery usage in the contracting framework between the project and the offtaker,” Surie said.
“Battery technology has developed rapidly over the past few years, with performance going up and pricing coming down. This is now resulting in solar-battery combinations being able to effectively compete with baseload power solutions like gas and coal. Though lithium-ion is currently the mainstream technology, we should be seeing other types of technologies disrupt the industry in the near future, allowing renewable power solutions to take on an even more prominent role in the global energy space.”
The project is ERS’s second solar PV plant in Senegal. A 20MW plant next to Engie’s 35MW solar PV plant in Kahone was commissioned in 2018. ERS aims to develop 500MW of power by 2025. ERS is 51% owned by Senegalese entrepreneur Moustapha Sene and 49% by Senelec. CFM is a joint venture between Dutch development bank FMO and South Africa’s Sanlam InfraWorks.