Published: 6 June 2024
NOA Group Holdings (NOA), is pleased to announce a 497 GWh energy supply agreement with Tronox Holdings plc (NYSE:TROX), a leader in titanium dioxide pigment manufacturing. This agreement, which significantly extends Tronox’s renewable energy penetration to above 70% of its electricity requirements, underscores NOA’s model of aggregating power from a fleet of generation facilities across the country, to be supplied to Tronox’s full portfolio of operating sites in South Africa.
“This model represents an advancement in renewable energy supply solutions for commercial and industrial offtakers in South Africa, representing the largest private wheeling transaction between an aggregator like NOA and a private offtaker,” explained Andrew Taylor, CEO of NOA Trading, NOA’s trading subsidiary. “It separates energy generation from consumption using NOA’s aggregation and trading platform, unlike traditional bilateral agreements tied to specific generation sites. This ensures more flexible, efficient, and reliable energy supply.”
Under a 25-year supply agreement, NOA will deliver a renewable energy profile to Tronox’s five sites across the Western Cape and KwaZulu-Natal. This is facilitated by Eskom’s wheeling model, which allows NOA to source energy from diverse wind and solar facilities nationwide, thus enhancing supply reliability and tailoring generation profiles to specific geographic and resource characteristics. “The initiative is bolstered by the issuance of verified International Renewable Energy Certificates (IRECs), which authenticate the delivery of renewable energy. This is pivotal in supporting Tronox’s ambitious decarbonization goals and reducing their reliance on fossil fuel-derived energy,” added Taylor.
NOA is leveraging significant equity investment to solidify its position in the renewable energy market and create strategic partnerships with established companies. With R3.2 billion of equity capital, committed by NOA’s majority shareholder, AIIM, NOA is positioned as a reliable supplier of renewable energy to the South African market. This transaction with a blue-chip offtaker like Tronox is viewed as a flywheel deal, enhancing NOA’s strategic standing and capabilities in the sector.
The agreement between NOA and Tronox, building on an initial renewable energy procurement in March 2022 from a wheeled solar PV PPA, solidifies Tronox’s leadership in decarbonization. By doubling down on efforts to reduce operational costs and accelerate their decarbonization path, Tronox is aligning with the industry-wide move towards lower carbon operations.
Tronox’s Chief Sustainability Officer and Head of Investor Relations, Jennifer Guenther, commented, “Tronox’s solar and wind renewable energy agreements with SOLA and NOA will reduce our global Scope 1 and 2 greenhouse gas emissions by 25% compared to our 2019 baseline, marking significant progress on our decarbonisation roadmap towards net zero carbon emissions.
“Decarbonisation is critical for mining and industrial companies taking aim at net-zero targets. For Tronox, achieving this goal is largely facilitated by increasing the use of renewable energy as this latest agreement facilitates an annual offset of over 500 kilotons of carbon,” Taylor concluded.
