Information and communications technology infrastructure company Teraco has started construction of its 120 MW utility-scale solar PV power plant in the Free State, which is expected to come online in late 2026.

Teraco will own the 120 MW solar PV plant and wheel the renewable energy to its data centres, with the plan to create its own sustainable energy source to power the next generation of client cloud and AI computing applications.

“This is only the first phase of our longer-term renewable-energy commitment, with the start of construction marking an important milestone in what has been a long journey over the past several years,” says Teraco CEO Jan Hnizdo.

“Driving renewable energy infrastructure investment at a time when computing applications such as AI are using increased power is an industry imperative.

“The need is even more acute in South Africa, given its electricity generation constraints and current levels of renewable-energy penetration. This is a significant step toward meeting our renewable-energy ambitions and those of our clients,” he emphasises.

Further, Teraco plans to not only own its data centres, but also to power them with a renewable-energy sources, thereby creating a sustainable path to growth. This initiative aligns with Teraco’s long-term vision of powering digital transformation across Africa.

“South Africa’s solar power represents a competitive advantage for data centres relative to other locations. The various energy challenges we have present an opportunity to support the needs of our broader community through the addition of generation capacity to our constrained grid, while meeting Teraco’s near-term renewable-energy objectives,” he adds.

Teraco successfully secured grid capacity allocation from Eskom for the solar plant in February and has spent the past eight months finalising plant design and the wheeling arrangements between Eskom and the municipalities of Ekurhuleni and Cape Town, where several of Teraco’s data centres are located.

“Teraco considers this project essential to achieve its renewable-energy ambitions and believes it will pave the way for other municipality renewable energy wheeling projects,” says Teraco head of sustainability Bryce Allan.

This will ultimately help municipalities to attract new investments and remain competitive, as local and international companies become increasingly sensitive to the carbon intensity of their electricity supply.

Teraco has partnered with renewable-energy company JUWI and solar plant developer Subsolar to develop the 120 MW plant, with JUWI appointed to design and manage the procurement, construction and commissioning.

“Our strategy is to control our own solar project and, together with our partners, directly drive its development. This project delivers on our commitments to clients and shareholders,” adds Allan.

Further, Teraco will also upgrade Eskom’s transmission infrastructure to allow the electricity generated to be successfully transmitted through the national grid.

When fully operational, the 120 MW plant is expected to produce more than 354 000 MWh/y.

Wheeling renewable energy across electrical grids enables power to be moved from a renewable-energy producer in outlying areas via existing transmission and distribution systems to end-users in urban areas.

It also allows the deployment of renewable-energy projects to areas with high energy yields to maximise their generation potential.