18-month timeline for renewables
DMRE reveals details for procurement
SOUTH Africa’s emergency power procurement programme for renewable energy, which is aimed at dealing with electricity supply constraints, will take more than 18 months to complete.
The Department of Mineral Resources and Energy (DMRE) revealed this at the weekend when it issued the Request for Proposals (RFP) for the risk mitigation independent power producers procurement programme (RMIPPPP).
The RMIPPPP is a direct response by the government to the short-term electricity supply gap as identified in the country’s energy blueprint, the 2019 Integrated Resource Plan.
The programme seeks to procure 2 000 megawatts of electricity from a range of energy sources and technologies, and is expected to attract investment in the region of R40 billion.
The DMRE said the objective of the RMIPPPP was not only to alleviate the electricity supply constraints, but also to reduce the use of diesel-based peaking electrical generators.
“Proposed technical solutions will have to be dispatchable and be able to provide a range of support services to the grid system operator,” it said.
“All power procured under this programme is expected to be fully operational by not later than the end of June 2022.”
Dispatchable generators are sources of electricity that can be used on demand and dispatched at the request of power grid operators, according to market needs.
The country is battling with electricity challenges as breakdowns at Eskom’s ageing coal- and diesel-fired plants force it to implement load shedding.
Eskom today implemented load reduction during the morning peak hours in parts of Soweto and the Vaal to avoid network overloading in high-density areas.
The government last month promised that the documentation inviting bids for the RMIPPPP would be released at the beginning of this month at the latest.
DMRE Minister Gwede Mantashe said on Saturday that the RFP was designed to support broad-based black economic empowerment initiatives, including ownership and localisation.
“Bidders will have to make commitments in terms of job creation, socio-economic development, supplier and enterprise development and skills development,” he said.
“Stringent local content thresholds and targets have been introduced that should provide impetus to the local construction and manufacturing sectors.”
It is anticipated that projects under the RMIPPPP must be able to connect at intervals of between three and six months and six and 12 months, from issuance of the notice to proceed.
Independent energy expect Chris Yelland was not optimistic about the government’s time lines, considering that Mantashe first announced the programme in December when the country was plunged into unprecedented Stage 6 load shedding.
“I wonder how long the bidding, bid adjudication, bid announcement, power purchase agreement, financial close, construction and commissioning processes will be before the first kilowatt starts flowing into the grid,” he said. “In China, it would probably take a couple of months. In South Africa, I’m not so sure.”