South Africa Announces Preferred Bidders in 2600 MW Renewable Tender

The Minister of Mineral Resources and Energy (DMRE) of South Africa, Gwede Mantashe, briefed the media on the latest developments in the Energy Sector. He announced the names of 25 preferred bidders in the fifth bid window (BW5) under the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) that targets 2600 MW of solar and wind capacity.

Under the programme, the bidders will be allocated 1600 MW of onshore wind and 1000 MW of solar capacity.

The Government issued the Request for Proposal in April this year and committed to announcing the preferred bid before the end of October. The Department of Energy published a list in August containing the names of 102 bidders; 63 solar and 39 wind projects with a capacity equivalent to 9644 MW.

The outcome of the evaluation process has resulted in the selection of 25 preferred bids of which 12 wind and 13 solar bids for procuring a total of 2583 MW.

The weighted average price of the preferred bidder for the renewable energy projects is 473 ZAR per MWh, where the weighted average price for wind is 495 ZAR per MWh and for solar, it is 429 ZAR per MWh.

The preferred bidder’s projects are expected to make private sector investment amounting to 50 billion ZAR to the South African Economy and create some 13900 job opportunities.

Mantashe also added that with all IPP Procurement Programme to date, the Bid Window 5 has set out a number of economic development targets.

The winning bidders are required to complete the regulatory approvals including generation of licenses from National Energy Regulator of South Africa (NERSA) and reach the commercial close stage for their projects by the end of March 2022. The Government has set a target for the installed projects to be connected to the grid latest by April 2024.

Through these allocations, the government aims to reduce its dependency on coal-generated electricity.

In a separate announcement, global wind and solar company, Mainstream Renewable Power, announced that 12 of its projects have won preferred bidder status in Round 5 of South Africa’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).