ACWA Power and the Industrial Development Corporation of South Africa (IDC) announce the signing of a comprehensive Memorandum of Understanding. This partnership focuses on the development of renewable hydrogen and its derivatives in South Africa.
A renewable hydrogen project
For ACWA and IDC, this is the first agreement, although they were collaborating in a plant in South Africa. ACWA Power will operate as a developer of renewable hydrogen and its derivatives in South Africa. While IDC will act as co-developer and financial partner in the proposed projects.
Paddy Padmanathan, President and CEO and Vice President of ACWA Power; states:
“As a company driving the energy transition, ACWA Power is proud to work closely with the IDC with whom we share a strong working history, and today we are excited to continue our collaboration. I am confident that our expertise in developing large-scale green hydrogen projects in other geographies will enable us to successfully create a new pathway for sustainable energy production that will pave the way for further progress.”
This partnership coincides with the state visit of South African President Cyril Ramaphosa to the Kingdom of Saudi Arabia. The potential value of this contract is estimated at $10 billion.
An economic opportunity
South Africa has a net zero target for 2050. The country plans to become a major producer and exporter of renewable hydrogen and its derivatives. As a result, the government is mandating theIDC to lead the development and commercialization of the hydrogen economy.
Thus, the signing of this protocol is a step towards further investments in the diversification of the South African energy mix. Joanne Bate, COO, IDC, states:
“The IDC recognizes the substantial value and benefits that the green hydrogen economy will bring to South Africa. The green hydrogen economy presents new economic, skills, employment and community opportunities for the country. We are pleased to explore potential partnership opportunities with ACWA Power, given its pedigree and expertise in this industry.”
In parallel to this partnership, IDC is supporting the development of several catalyst projects in the renewable hydrogen value chain.
Development of renewable hydrogen
The company has had a presence in South Africa since 2016 and currently has two solar plants, Bokpoort and Redstone, in the country. Both projects use concentrated solar power technology. ACWA is cooperating with NEOM and Air Products to develop the largest renewable hydrogen project in Saudi Arabia.
In addition, ACWA Power, in a joint venture, signed a development agreement. This is a renewable hydrogen-based ammonia production facility in Oman. The investment represents several billion dollars.
