JSE-listed Impala Platinum (Implats) has signed a five-year power purchase agreement (PPA) with Discovery Green for the supply of wheeled renewable electricity to its refinery operations in Springs, Ekurhuleni, from the end of 2026.

The mining company said 90% of the operation’s electricity supply, or more than 130 000 MWh, would be sourced under the PPA, and would enable Impala Refineries to slash it Scope 2 greenhouse-gas emissions by more than 852 000 t over the PPA period.

COO Patrick Morutlwa said the PPA represented the first phase of the group’s aggregator-wheeling programme, which was being pursued to assist it in meeting its target of reducing carbon emissions by 30% by 2030, against a 2019 baseline.

The programme is also seen as complementary to the group’s own renewable-energy project pipeline, which includes a completed 35 MW solar plant at Zimplats, in Zimbabwe, the first phase in a 185 MW solar build at the operation.

Without providing details, Implats also confirmed that the deal would yield costs savings, with CEO Nico Muller saying only that it represented a “significant lever in our ability to control input costs”.

Discovery Green CEO Andre Nepgen also refrained from providing pricing specifics in an interview with Engineering News & Mining Weekly, but confirmed that the PPA had been structured to deliver both cost savings and price-path certainty.

This, in a context where Eskom’s tariff request is under adjudication by the regulator, with the utility having requested increases of 36.15%, 11.81% and 9.1% for the coming three years.

Nepgen confirmed that the PPA was one of the largest, but not the largest, wheeling transaction concluded by Discovery Green, with further PPA announcements to be communicated in the not-too-distant future.

He said the electricity wheeled under the PPA would be nine times that of the consumption of Discovery’s high-profile head office in Sandton and would be sourced from multiple wind and solar facilities being advanced to construction by independent power producers (IPPs) in various South African provinces.

Discovery Green has entered into exclusive procurement contracts with the IPPs, the majority of which are wind generators, with the intention of supplying the electricity to multiple customers that, like Implats, are pursuing decarbonisation and seeking price-path certainty.

“We are not the IPP nor do we invest in the actual project. We are long-term off-takers of the energy from these projects,” Nepgen explained, revealing that the electricity would be wheeled through the Eskom network.

By contracting across multiple generation sites and entering into contracts with multiple end customers, Discovery Green is able to offer PPA terms that are flexible in duration, with the five-year PPA with Implats being one of the shortest concluded. It then seeks to match the energy supplied by the variable generators with the demand profile of the various customers.

Discovery Green’s ‘take-and-pay’ offering has been facilitated through a trading licence it secured last year from the National Energy Regulator of South Africa, notwithstanding Eskom’s objections.

The utility subsequently launched a legal review of the decision, which Nepgen acknowledged represented a possible risk.

However, he said various actions were being take to mitigate that risk while expressing optimism that the concerns being raised by Eskom could be addressed by changes to the “tariff mechanics”, which he acknowledged had not kept pace with developments in the electricity market.