HomeIndustry SectorsFinance and PolicyRenewable energy: expedited bid window documents released in S.Africa

Renewable energy: expedited bid window documents released in S.Africa

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View the Macfarlanes’ eBulletin for insight on the expedited bid window documents’ prerequisites, generation capacities, pricing caps and expectations. Pic credit: radio timisoara

In South Africa, the South African Department of Energy has issued bid documents for the Expedited Bid Window for the procurement of an additional 1,800MW of renewable energy generation capacity under the REIPPP programme, said corporate law firm Macfarlanes.

The renewable energy bid documents released this week include Part A (General Rules and Requirements), Part B (Qualification Criteria) and Part C (Evaluation Criteria), with the remaining suite of documents scheduled to be released later this month.

It is expected that the remaining bid documents will include the updated requirements relating to economic development, technical and general bid returnable schedules and the suite of government-side project documents, explained Macfarlanes in an eBulletin.

Previous unsuccessful bidders welcomed

Last month, ESI Africa reported that the Expedited Bid Window is open to all renewable energy projects that are ready for submission, including projects that were unsuccessful in previous bid windows.

The form and content of the bid documents are largely based on the ones for bid window 4, except for some differences, which Macfarlanes has fully identified in a short report.

In this round, the only renewable energy technology to have its maximum contracted capacity increased is concentrated solar power (CSP) that increases to 150MW, with the total available MW’s per technology allocated as follows:

  • Onshore wind: 650MW
  • Solar PV: 520MW
  • CSP: 450MW
  • Biomass: 100MW
  • Landfill gas: 15MW
  • Small hydro: 40MW
  • Biogas: 25MW

Important deadlines & price caps

  • Registration deadline for bids is 8 September 2015
  • Bid submission date is 6 October 2015
  • Preferred bidders announcement is scheduled for 11 December 2015
  • Projects must be capable of beginning commercial operation before the end of 2019;
  • A cost estimate letter to be included in a bid response must have been signed and issued by the grid provider on a date which falls after 25 June 2015

The Macfarlanes’ eBulletin notes that the price caps for onshore wind and solar PV technologies have been re-introduced and the new price caps for each technology are published as follows:

  • Onshore wind: R760 / MWh ($62 / MWh)
  • Solar photovoltaic: R870 / MWh ($71 / MWh)
  • Concentrated solar power: R1,370 / MWh ($111 / MWh)
  • Biomass: R1,475 / MWh ($120 / MWh)
  • Landfill gas: R990 / MWh ($80 / MWh)
  • Small hydro: R1,117 / MWh ($91 / MWh)
  • Biogas: R1,475 / MWh ($120 / MWh)

Financing and small projects programme

Amongst other amendments, the document stipulates that the breakdown of the sources and uses of funds in the financial model has been omitted from the expedited window. In addition, bidders are no longer required to demonstrate compliance with the average net asset test or track-record test in raising the requisite financing.

Macfarlanes points out that the bid documents also provide an update on the Department’s intention to procure an additional 6,300MW of new generation capacity under the Renewable Energy IPP Procurement programme’s small projects programme in which it is anticipated that the megawatts will be allocated as follows:

  • Onshore wind: 3,000MW
  • Solar photovoltaic: 2,200MW
  • Concentrated solar power: 600MW
  • Biomass: 150MW
  • Landfill gas: 40MW
  • Small hydro: 60MW
  • Biogas: 50MW
  • Small projects: 200MW

Macfarlanes concluded: “This [expedited bid window] will be welcomed by prospective bidders and investors as it provides the desired certainty that there will be a pipeline of renewable energy projects in South Africa’s procurement of much needed new electricity generation capacity.”

Nicolette Pombo-van Zyl
As the Editor of ESI Africa, my passion is on sustainability and placing African countries on the international stage. I take a keen interest in the trends shaping the power & water utility market along with the projects and local innovations making headline news. Watch my short weekly video on our YouTube channel ESIAfricaTV and speak with me on what has your attention.