The recently opened fifth bid window of the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP) will give IPPs the opportunity to pitch energy tariff offers to the government.
To assist IPPs with their projects, three of South Africa’s experienced industry specialists – Carnegie Energie, Economic Development Solutions (EDS), and SDG Legal have joined forces to create a consortium called CES Project Advisory.
The consortium will offer a consolidated turnkey solution providing bidders with a single service provider point of engagement from project development, through bid submission to financial close and on to date of commercial operation (COD).
Timelines are unbelievably tight
According to Chris Carnegie, managing partner at Carnegie Energie, the risk mitigation bids will need to reach financial close within four to five months and this tight timeline will put pressure on these high-value projects.
“Thereafter, the projects must be built and COD achieved within 12 to 14 months. It’s clear there is no time to waste on these projects. Bidders in REIPPPP round 5 will need assistance with everything from finalising permits to National Energy Regulator of South Africa (NERSA) applications, completing feasibility studies, finalising funding terms and ensuring that the project can meet the local content requirements,” states Carnegie.
Janine Espin, managing director of EDS, comments: “IPPs face the immense challenge of engaging with numerous companies to assist with bid preparation and compliance. This complicates the process and can result in delays and frustrations.”
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Risk management is key
To present a compliant and competitive bid, IPPs will need to evidence project viability and meet local content, environmental and other legal requirements.
“By unifying competencies, we’re effectively merging disparate workstreams. Legal, technical, financial, and economic development workstreams usually run parallel to each other. If these teams struggle to reach consensus or misunderstand one another the process to rectify this can be time-consuming and counter-productive,” explains Tammy-Lynne Bekker of MD of SDG Legal.
Lize Louw, Director at SDG Legal clarifies. “When client requirements change, we don’t have to go through cumbersome organisational hierarchies as we have the authority to immediately adapt to that change. Furthermore, we can issue the legal opinions and take care of everything necessary to ensure a project is ‘bid ready’ quickly and correctly.”
In approaching the CES Project Advisory, IPPs will benefit from existing relationship management between service providers, which can be invaluable when it comes to saving time and minimising bid compliance risk.
The consortium is 100% South African-owned with a high degree of diversity and large female-owned equity participation.