Teraco spending R2 billion to reduce reliance on Eskom

Teraco Data Environments, Africa’s largest data centre company, is building a utility-scale power plant to run its operations in South Africa. 

The firm raised an initial R2 billion with Absa for the construction of a 120 MW solar plant and an 80 MW wind farm in South Africa’s Free State province, which will power its facilities and help deal with rolling blackouts.

“The plan is to get all of our power from renewable energy sources by 2035,” CEO Jan Hnizdo said in an interview. 

Almost daily outages in Africa’s most developed economy that often leave homes and businesses without power for more than 10 hours a day are forcing companies to invest in their own generation facilities.

Data centres, in particular, consume a significant amount of electricity. Teraco expects the solar plant to provide eight hours of supply per day, supplementing power from Eskom.

Teraco expects the state-owned power utility’s coal dependency to decrease from 85% to 60% over the next three years as more independent power producers come on stream. 

Negotiations to secure agreements with the South African government and Eskom to connect to the grid took about three years, and the facilities are expected to come online in the next three years, said Hnizdo.