The Department of Energy (DoE) has issued the long-awaited request for bids (RFB) for the manufacture, supply, delivery and warehousing of solar water heater (SWH) systems to be procured, in phases, as part of a national solar geyser roll-out.

The plan envisages the procurement of 1.25-million systems by 2019, raising the total installed base to 1.75-million, with a number of systems having been installed under a rebate scheme previously administered by Eskom.

The State-owned utility informed SWH stakeholders in December 2014 that a handover process was under way and that the DoE would manage the future implementation and funding of the programme. Eskom continued to process rebate claims during the first few months of 2015, but there was a significant delay in finalising the architecture of the replacement scheme.

The RFB, released in early December, is for procurement of an initial 100 000 SWHs during 2016 and 2017.

A bid submission date of January 15, 2016, has been set, while a briefing session will be held at the DoE’s offices in Pretoria at 10:00 on December 14.

The DoE is targeting the installation of 50 000 systems by October 1, 2016, and a further 50 000 by September 1, 2017.

The systems are to be installed under the ‘social programme’ component of a bigger programme, which also includes an ‘insurance’ programme and a ‘voluntary’ scheme.

Under the insurance component, a subsidy will be provided to enable insurers to promote the replacement of conventional electric geysers with compliant SWH systems, while South Africans who wish to participate under the voluntary arrangement will be able to contact a national call centre for a similarly subsidised installation.

The systems supplied, installed and maintained through the social programme will be installed largely on a free-issue basis, but provision has been made for such systems to be provided on a partially subsidised basis.

The DoE plans to procure the systems for installation in residential dwellings within the ‘Designated Installation Areas’ and will initiate a separate procurement process to appoint installation contractors to manage the deployment.

The supply programme will be undertaken in accordance with the provisions of the Preferential Procurement Policy Framework Act (PPPFA) and the PPPFA Regulations, which include a ‘stipulated minimum threshold’ for local content.

The local-content threshold for the main components – the storage tanks and solar collectors – has been set at 70%. Bidders will be required to provide verification of the local content, with the South African Bureau of Standards having been appointed as the independent verification agency.

The DoE expects to announce the preferred bidders on February 29 and sign supply agreements on March 15.

Solar Water Heating Manufacturers Cluster of South Africa, or SWH-Mancosa, chairperson Mike Breckenridge indicates that the industry has several concerns with the RFB, noting that there had been little or no engagement between industry and the DoE ahead of its release.

"Although, hopefully, some items might be resolved, or at the very least aired, during the briefing session, due to take place next week," he says.

The industry, Breckenridge adds, is currently also in a "precarious position", owing to unresolved issues at the South African Bureau of Standards (SABS) – the only South African National Accreditation System-accredited testing facility – which is experiencing difficulties in fulfilling its mandate.

"We are, however, pleased to note the inclusion of the insurance component and the subsidised voluntary aspect, as this, over and above the national solar geyser roll-out programme, will further benefit the local industry."