Name and Location
Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) – third round, South Africa.

Client
Department of Energy (DoE).

Project Description
Seventeen renewable-energy developers have been appointed as preferred bidders, following the conclusion of the third bid-submission round under the REIPPPP.

The wind projects listed include:
• Red Cap – Gibson bay (110 MW)
• Longyuan Mulilo De Aar Maanhaarberg wind energy facility (96 MW)
• Longyuan Mulilo De Aar 2 North Wind energy facility (139 MW)
• Nojoli wind farm (87 MW)
• Khobab wind farm (138 MW)
• Noupoort Mainstream Wind (79 MW)
• Loeriesfontein 2 wind farm (138 MW)

The wind projects collectively represent 787 MW of capacity.

The solar photovoltaic projects named are:

• Adams solar PV 2 (75 MW)
• Tom Burke solar park (60 MW)
• Mulilo Sonnedix Prieska PV (75 MW)
• Electra Capital (75 MW)
• Pulida solar park (75 MW)
• Mulilo Prieska PV (75 MW)

The combined capacity of the solar PV projects that progressed to the preferred-bidder stage was 435 MW.

The preffered concentrated solar power (CSP) bidders include Xina CSP South Africa (100 MW) and Karoshoek Consortium (100 MW) for a combined capacity of 200 MW.

One landfill gas bidder, the Johannesburg landfill gas-to-electricity project, with a capacity of 18 MW, and one biomass bidder, the Mkuze biomass project,  with a capacity of 16 MW were also named.

Value
Not stated.

Duration
The winning bidders are expected to sign project agreements with the DoE by July 30, 2014, after which developers will have about one month to finalise all documentation and foreign-currency hedging before project roll-out is set to begin.

Latest Developments
The DoE has postponed an announcement regarding the appointment of further renewable-energy projects, in addition to the 17 perferred bidders, following the third bid window under the REIPPPP.

Initially, an announcement regarding the possible addition of further preferred bidders was scheduled for November 20, but the DoE has experienced delays in finalising its approach to the allocation of additional capacity for onshore wind and solar PV technologies. At that time the DoE was aiming to make an announcement by no later than December 31, 2013.

With the addition of the 17 projects on October 29, South Africa’s portfolio of approved REIPPPP projects has increased to 64, representing a combined investment value of between R120-billion and R150-billion and a collective capacity of 3 933 MW.

There are currently 47 projects that have already moved through the financial-close threshold and which are at various stages of development. Some projects have started producing electricity.

However, the 93 bids with competitive responses, received by the August 19 submission date, representing 6 032 MW of potential capacity, prompted the DoE to consider the appointment of additional preferred bidders.

This would require a reallocation of the capacity set aside for onshore wind and solar PV projects for future REIPPPP submission windows, as the allocation for round three had been restricted to 1 473 MW.

Several commentators have argued strongly in favour of adding to the third-round allocation, and Energy Minister Dikobe Ben Martins has indicated that the issue is being given serious consideration.

Meanwhile, it has also emerged that the State-owned Industrial Development Corporation has approved R6.5-billion in support for five of the projects that qualified as preferred bidders in round three.

Green industries head Rentia van Tonder says that the development financer is a shareholder in and lender to the third round’s two CSP projects, Xina and Karoshoek. It is also supporting two wind projects and one solar PV project.

Bidders are concluding finance arrangements with lenders and construction agreements with contractors to reach financial close in July 2014, the date set by the DoE for signing the power purchase agreements for these projects.

Also, financial services provider Rand Merchant Bank (RMB) is financing a CSP project and a biomass project awarded in round three of the REIPPPP.

Key Contracts and Suppliers
Futuregrowth, RMB, Enel Green Power, Mainstream Renewable Power, Abengoa, Cobra Energia, Aurora Power Solutions, Total SA and Mulilo Renewable Energy.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Mainstream Renewable Power, Emmet Curley, tel +353 1 290 2027 or email emmet.curley@mainstreamrp.com.
Futuregrowth, tel  +27 21 659 5300, fax +27 21 659 5333 or email  info@futuregrowth.co.za.
Enel Green Power international press officer Roberta Vivenzio, tel +39 06 8305 1, fax +39 06 8305 3771 or email roberta.vivenzio@enel.com.
Abengoa communications department, Patricia Malo de Molina Meléndez, tel +34 954 93 71 11 or email communication@abengoa.com.
Cobra Energia, tel +91 456 95 00, fax +91 456 94 50 or email central@grupocobra.com.
Mulilo Renewable Energy, tel +27 21 934 5268, fax +27 21 935 0505 or email info@mulilo.com.
Rand Merchant Bank, tel +27 11 282 8000, fax +27 11 282 8008 or email info@rmb.co.za.
Aurora Power Solutions, tel +27 21 421 9764, fax +27 865 138 648 or email info@apsolutions.co.za.