Name of the Project
Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP).

Location
South Africa.

Project Owner/s
Department of Mineral Resources and Energy (DMRE).

Project Description
The RMIPPPP, also known as the ‘emergency’ procurement round, is a response to the short-term electricity supply gap identified in the Integrated Resource Plan 2019.

The objective of the RMIPPPP is to not only alleviate the current electricity supply constraints but also reduce the use of diesel-based peaking electrical generators.

The programme aims to procure 2 000 MW from a range of energy sources and technologies.

The DMRE issued a request for proposal for the RMIPPPP in August 2020.

Mineral Resources and Energy Minister Gwede Mantashe released the names of the eight preferred bidders on March 18, 2021:

• the 150 MW ACWA Power Project DAO – a hybrid facility comprising solar photovoltaic (PV) and a battery energy storage system (BESS);
• a 450 MW Karpowership SA Coega facility – a gas-to-power plant based on imported liquefied natural gas (LNG) – in the Northern Cape;
• the 450 MW Karpowership SA Richards Bay facility – a gas-to-power plant, based on imported LNG – in the Northern Cape;
• a 320 MW Karpowership SA Saldanha facility – a gas-to-power plant, based on imported LNG – in the Northern Cape;
• the 198 MW Mulilo Total Coega facility – a hybrid plant employing solar PV and imported LNG;
• the 75 MW Mulilo Total hydra storage project – a hybrid facility comprising solar PV and a BESS;
• the 128 MW Oya Energy hybrid facility – a hybrid facility comprising solar PV, wind and a BESS, in the Northern Cape; and
• the 75 MW Umoyilanga Energy – a hybrid facility comprising solar PV, wind and a BESS, Northern and Eastern Cape.
• Umoyilanga Energy will operate as a virtual power plant, combining generation from two sites that are 900 km apart. Avondale, in the Northern Cape, will include 115 MW of solar PV and 30 MW of battery storage, while Dassiesridge, in the Eastern Cape, will incorporate 63 MW of wind and 45 MW of battery storage.

To meet its 75 MW dispatchable profile, Dassiesridge will charge batteries from the wind energy at night and discharge power in the morning until the sun rises. The solar installation at Avondale will supply the bulk of the energy during the day, supplemented by wind energy from Dassiesridge. Excess solar energy will be used to charge the batteries at Avondale, which will discharge after sunset.

In June 2021, the DMRE announced the appointment of three additional preferred bidder projects under the RMIPPPP, following the completion of “value for money” negotiations with Norwegian renewables power producer Scatec.

To meet the dispatchable profile demanded under the RMIPPPP, the three projects – Kenhardt 1, Kenhardt 2 and Kenhardt 3 – will together produce 540 MW of solar and 225 MW/1 140 MWh battery storage.

Scatec has indicated that the projects are the only ones selected under the RMIPPPP that rely exclusively on renewable energy, making the three-project portfolio arguably one of the biggest single-site solar-storage hybrids in the world.

The projects will include average local content of 50% during construction, South African entity participation of 51% and black ownership of 41%.

Potential Job Creation
The Oya Energy hybrid facility and Umoyilanga Energy will contribute 3 966 job-year opportunities in the construction and operation of these power plants.

Capital Expenditure
The combined investment value of the initial eight projects is estimated at R45-billion.

The Oya Energy hybrid facility and Umoyilanga Energy projects have a combined investment value of R14.6-billion.

Planned Start/End Date
The Oya Energy hybrid facility and Umoyilanga Energy projects are expected to be online from 2025 onwards.

Umoyilanga  Energy is expected to achieve financial close by the second half of October 2023, with construction starting immediately thereafter to achieve commercial operations in May 2025.

Latest Developments
Scatec CEO Terje Pilskog has reported that the R16.4-billion Kenhardt hybrid project, a 10 × 3 site in the Northern Cape, is on track to begin producing later this year.

The project is the largest renewable hybrid facility on the continent.

Despite being the last project to be selected as a preferred bidder under the much-delayed 2020 RMIPPPP, Kenhardt is the only project named under the 20-year scheme to have achieved financial close to date, and has been under construction since July 2022.

Two additional RMIPPPP hybrid projects recently signed project agreements to achieve financial close before the end of the year, while Karpowership, which secured the lion’s share of the scheme’s 2 000 MW allocation, continues to express optimism that it, too, will proceed with its three projects. This, despite government’s having indicated that it does not want the floating gas-to-power vessels to operate for longer than five years.

Pilskog says South Africa was selected to host Scatec’s latest board meeting, partly to expose its directors to the innovative Kenhardt project and partly to offer them greater insight into the South African business, which entered the market in 2010 and currently employs about 300 people.

During that period, South Africa has assumed the position of the group’s engineering hub from Germany and also houses Scatec’s control and monitoring centre, which provides 24/7 plant performance management.

“South Africa is currently at the forefront of what we are doing globally,” Pilskog says, indicating that the country has provided engineering expertise for its projects across the world.

Pilskog has said Kenhardt will prove that solar is not only competitive as a variable provider of electricity but also competitive “as baseload”.

That competitiveness, he argues, will be sustained even in areas of South Africa that are not located in the regions with the country’s best solar and wind resources, and which are currently grid-constrained.

Meanwhile, two ecojustice groups plan to challenge Forestry, Fisheries and Environment Minister Barbara Creecy's decision to allow Karpowership SA to submit a key document for the environmental approval of its proposed Saldanha Bay plant.

Creecy had overturned a decision by her department's chief director for integrated environmental authorisations to deny Karpowership SA an extension to submit a Generic Environmental Management Programme report (GEMPr) for the 320 MW plant in Saldanha Bay.

However, the Green Connection and Natural Justice issued a joint statement on September 6, indicating that an "administrative error" led to the Minister not receiving their objections. They believe that if the Minister had received their submissions, it would have "materially affected" her appeal decision.

"The Minister did not have the Green Connection and Natural Justice's submissions before her when she made her decision. We believe that Minister Creecy's decision to now allow for the late submission of Karpowership's GEMPr is incorrect, since she did not consider all the information that should have been available to her," the Green Connection's community outreach coordinator Neville van Rooy has said.

"… We believe that the Minister must approach the courts herself, to get her decision overturned," Van Rooy adds.

The DFFE has allowed Karpowership to continue with an appeal against a previous decision denying it environmental authorisation for the 450 MW plant at the Port of Ngqura.

Key Contracts, Suppliers and Consultants
Scatec (Kenhardt 1, Kenhardt 2 and Kenhardt 3 ); G7 Renewable Energies, ENGIE, Meadows Oya Energy and Perpetua RMI4P (Oya Energy hybrid facility); and EDF Renewables and Perpetua Holdings (Umoyilanga Energy).

Contact Details for Project Information
DMRE, Natie Shabangu, email natie.shabangu@dmre.gov.za; or Thandiwe Maimane, email thandiwe.maimane@dmre.gov.za; mediadesk@dmre.gov.za.