South Africa: Gagasi Offshore Wind Farm Richards Bay Progresses Toward FID

• The 810MW Gagasi offshore wind farm, a GenesisHexicon joint venture off Richards Bay, launched in 2022 and is in its fifth year of development, aiming to supply electricity within five years.
• The project is preparing to resubmit its environmental scoping report after its environmental authorisation application was withdrawn in 2025 for a technical redesign, and is finalising a seabed lease agreement.
• Construction for the Gagasi project, which includes 54 turbines (600MW fixed, balance floating), could begin in 2030 and last 12 to 18 months.
• As the first of its kind, the project highlights the need for clarified roles and responsibilities among national and provincial entities for various authorisations.
• The Strategic Framework for Offshore Wind Development in South Africa identifies a 95 GW offshore wind opportunity, positioning the country as a potential regional hub with significant job creation potential.

As the inaugural project of its kind, the Gagasi development highlights the critical need for clear delineation of roles and responsibilities among national and provincial entities concerning required authorisations.

The Gagasi offshore wind farm, an ambitious 810-megawatt (MW) project situated off the coast of Richards Bay, launched in 2022, is in its fifth year of development, with aspirations to commence electricity supply to the national grid within the next five years. This significant undertaking is part of the broader GenesisHexicon offshore wind programme, a joint venture that has been actively progressing the project.

Planning for the Gagasi facility envisions 54 turbines arranged in a rectangular formation, running parallel to the coastline. The southern portion of the site will see turbines positioned approximately 16 to 22 kilometers offshore, directly opposite the port of Richards Bay. Further north, the turbines will be closer to the shore, ranging from about 5 to 6 kilometers to 10 kilometers out. The design incorporates a mix of technologies, with 600 MW of the capacity utilizing fixed-bottom turbines, while the remaining balance will employ floating technology.

Developers estimate that similar offshore wind projects in Europe typically require investments ranging from R50 billion to R60 billion and take between five and seven years to complete. For Gagasi, the project is preparing to resubmit its environmental scoping report, following the withdrawal of its environmental authorisation application in 2025 for a technical redesign, which could pave the way for a final investment decision within the subsequent one to two years. Construction is tentatively slated to begin in 2030, with an anticipated build time of 12 to 18 months before commercial operations can commence. The project also allows for phased development, enabling some turbines to generate power even before the entire farm is fully operational.

A critical aspect of the Gagasi offshore wind farm's progress involves navigating South Africa's evolving regulatory environment for such large-scale energy infrastructure. While the ownership of the seabed unequivocally rests with the South African government, the project necessitates securing a multitude of authorisations from various national and provincial governmental bodies. As the inaugural project of its kind, the Gagasi development highlights the critical need for clear delineation of roles and responsibilities among national and provincial entities concerning required authorisations.

This clarification process is acknowledged by project managers Benjamin King and Madrè Delport of the GenesisHexicon programme as potentially time-consuming. In parallel with these regulatory engagements, the joint venture is actively finalising its seabed lease agreement. Furthermore, the project is preparing to resubmit its environmental scoping report, having withdrawn an earlier submission to integrate recent technological advancements into its plans. The developers are optimistic about obtaining environmental authorisation within the coming year.

The GenesisHexicon joint venture has expressed support for the recently published Strategic Framework for Offshore Wind Development in South Africa report, a collaborative effort between the South African government and the World Bank. This framework is a pivotal document, providing a foundational understanding of the country's offshore wind potential and the regulatory pathways for future projects like Gagasi.

The Strategic Framework for Offshore Wind Development in South Africa underscores the nation's significant potential in this sector, quantifying the offshore wind opportunity at an impressive 95 gigawatts (GW) – nearly double Eskom's current installed generation capacity. This positions South Africa as a prospective offshore wind hub, not only for domestic energy supply but also for developing a local supply chain and potentially exporting technology and expertise to other African nations where offshore wind is still nascent.

Beyond diversifying South Africa's energy mix, offshore wind at scale offers the benefit of smoothing out intermittency in power supply, as wind patterns off the country's East and West coasts are complementary. The technology is also seen as a catalyst for establishing new supply chains and generating substantial employment opportunities. The framework projects that offshore wind could support over 300,000 full-time-equivalent job-years and contribute approximately $6.7 billion (around R109 billion at current exchange rates) in employment wages to the South African economy by 2050.

While the cost per megawatt-hour for offshore wind generation is not anticipated to be lower than that of onshore wind or solar photovoltaic (PV) power, the increasing difficulty in securing land for utility-scale projects makes offshore alternatives increasingly attractive. The GenesisHexicon joint venture is experiencing considerable interest from potential offtakers and is exploring various options, including engagement with the developing South African Wholesale Electricity Market (Sawem).

Lawyers and compliance officers should closely monitor the evolving regulatory framework for offshore wind development in South Africa, particularly regarding the clarification of roles and responsibilities among national and provincial entities for permitting and seabed rights. This project, being the first of its kind, will set precedents for future applications, impacting environmental authorisations, project finance, and contractual agreements with offtakers.

Source: Original reporting via Moneyweb