(Sharecast News) - Ncondezi Energy updated the market on its 300MW solar photovoltaic (PV) and battery energy storage system (BESS) project's transmission integration study on Friday, reporting that the study to connect the solar project into the grid had been approved by Electricidade de Moçambique (EDM).
The AIM-traded firm said the study confirmed the technical viability to evacuate up to 300MW into the Mozambican grid, and the wider southern African region.
It also said the study confirmed the "optimal technical solution" was via a two phased approach, with the first phase targeting a lower-cost solution using existing infrastructure for the first 100MW.
The second phase would then targets planned infrastructure, and would transfer the balance of 200MW while also improving voltage control and stability, with lower system losses in the area.
Ncondezi said the transmission integration study included two connection options for the phased development of the solar project, up to 300MW.
The board said the approval of EDM would allow the company to engage transmission infrastructure owners to agree access, representing a "material de-risking step" for potential power off-takers.
"Approval of the solar project transmission integration study represents a key development milestone in de-risking the project for potential power off takers and investors," said chief executive officer Hanno Pengilly.
"We have an approved transmission evacuation technical solution that supports the project at various sizes up to 300MW, optimised in phases to reduce upfront capex, particularly for the first 100MW.
"Following the approval, the company is initiating discussions with transmission infrastructure owners to seek to agree access."
Pengilly said the company was "confident" access would be supported, as it believed the solar project would provide "significant transmission benefits", including greater energy security, voltage control and stability.
Ncondezi was targeting an update on that by the end of the first quarter.
"The solar project remains regionally strategic given its location within the Mozambique northern grid and proximity to critical cross border interconnectors including South Africa, Zimbabwe and, in the coming years, Malawi.
"The company has looked to capitalise on this by accelerating development work to best position the solar project with potential power off takers whose off take represents the next crucial milestone in unlocking the project's potential.
"Given the success in delivering critical milestones over the last six months, including the feasibility study and DUAT, the company is also assessing other potential work streams that could be fast tracked to maintain the solar project's competitive position."
At 1433 GMT, shares in Ncondezi Energy were up 1.94% at 0.79p.
Reporting by Josh White for Sharecast.com.
