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South Africa: Preferred bidders announced for emergency power programme


19 Mar 2021

Mineral resources and energy minister Gwede Mantashe on 18 March announced eight preferred bidders for the Risk Mitigation IPP (RMIPP) Procurement Programme, which aims to procure 2GW of power to bridge a looming supply gap.

The eight bidders, representing a total of 1,845MW, are: Acwa Power Project DAO, Karpowership SA Coega, Karpowership SA Richards Bay, Karpowership SA Saldanha, Mulilo Total Coega, Mulilo Total Hydra Storage, Oya Energy Hybrid Facility and Umoyilanga Energy.

Mantashe said a further three eligible bids were received totalling 150MW. These could be awarded at a later stage following a value-for money reassessment.

The three LNG projects total 1,220MW. Two of the projects are a combination of solar PV and battery storage totalling 225MW, another two combine solar PV, wind, and battery storage totalling 203MW, and one is a 197MW project combining LNG and solar PV.

The projects are required to reach financial close by the end of July 2021. “Due to the urgency to bring power online, this date is not negotiable. It is for the preferred bidders to manage all the risks to reach financial close,” Mantashe said. First power from the projects is expected in August 2022.

The prices for the RMIPP bids range from R1,468/MWh to R1,885/MWh, with a weighted average price of R1,575/MWh, Mantashe said. The Department of Mineral Resources and Energy (DMRE) issued a request for information for the programme in December 2019, aiming to procure 2-3GW of capacity from power generation facilities with short lead times to first power.

Mantashe also announced the release of a request for proposals (RfP) for the procurement of 2,600MW under the Renewable Energy IPP Procurement Programme bid window 5. Of the 2,600MW, 1,600MW will be from wind and 1,000MW from solar PV. “Given the energy challenges that we are facing the objective is to get these projects connected to the grid as soon as possible,” Mantashe said. Bids are due by 4 August.

The DMRE plans to release four more RfPs within the next 12 months, to include 2,600MW from renewable energy, 3,000MW from gas, 1,500MW from coal, and 513MW from battery storage.

 

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