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DMRE again delays bidding deadlines for procurement of new renewables and battery storage

31st May 2024

By: Terence Creamer

Creamer Media Editor

     

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The Department of Mineral Resources and Energy (DMRE) has confirmed another extension to the bid submission deadlines for the current renewables procurement round, as well as the second battery storage bidding round.

The deadline for Bid Window Seven (BW7) of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) which had already been moved from April 30 to May 30, has been extended to August 15.

The DMRE is seeking to procure 5 000 MW during the bid window, comprising 3 200 MW of wind and 1 800 MW of solar PV.

Likewise, the deadline for the Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP) BW2, which was initially moved from April 30 to June 6, has been delayed to August 29.

The DMRE is seeking to procure 615 MW/2 460 MWh across eight substations sites in the North West province, including Mercury, Carmel, Hermes, Ngwedi, Midas, Marang, Bighorn and Ararat.

In a notice published on the website of the IPP Office, the department indicated that BESIPPPP BW2 had been delayed at the request of “a substantial number of registered bidders” to enable the issuance of environmental authorisations by the Department of Forestry, Fisheries and the Environment.

No reference was made to BESIPPPP BW3 in the Free State, the deadline for which was extended by three months to October 31 in early May.

Reasons were not provided for the extension of REIPPPP BW7, but the move coincides with a decision by the National Energy Regulator of South Africa (Nersa) to extend, from May 25 to June 17, the deadline for comment on Eskom’s application to preserve and reserve grid capacity for IPPs participating in public procurement.

In its consultation paper, Nersa makes specific reference to BW7, as the request for grid reservation/preservation for projects being procured in line with Section 34 of the Electricity Regulation Act would have a direct  bearing on the round.

Eskom indicates that public procurement could fail should the utility be disallowed from discriminating in favour of Section 34 IPPs at the expense of IPPs being developed on the back of private power purchase agreements.

“Without any form of protection, public procurement programmes remain incapable of competing with the much more agile and well-funded private sector energy procurement programmes.

“Therefore, without grid preservation/reservation in favour of the public energy procurement programmes, these programmes are likely to continue failing as evidenced by the recent failure of BW6 of the Renewable Energy Independent Power Producer Procurement Programme,” Eskom says in its submission.

During BW6 in 2022, none of the 23 wind projects vying for 3 200 MW advanced to the preferred-bidder stage, owing to the grid capacity on which their bids were based being allocated to projects that secured grid connection budget quotes over the same capacity.

Edited by Creamer Media Reporter

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