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Nersa approves 28 renewables licences as financial close deadline nears

7th June 2012

By: Terence Creamer

Creamer Media Editor

  

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The National Energy Regulator of South Africa (Nersa) confirmed on Thursday that it had approved power generation licences for all of the 28 projects named as preferred bidders in December, following the first bid window under South Africa’s Renewable Energy Independent Power Producer Programme (REIPPP).

The licences are a key condition to enable bidders to reach financial closure by the June 19 deadline set under the REIPPP. But besides securing a licence, developers also need to conclude power purchase and connection agreements with Eskom, as well as implementation agreements with the Department of Energy.

Through the REIPPP, government is seeking to procure 3 725 MW of capacity, to be introduced into South Africa’s power generation mix between 2014 and 2016.

On December 7, Energy Minister Dipuo Peters named 18 solar photovoltaic projects, representing 631.53 MW of capacity, two concentrated solar power projects, with a combined capacity of 150 MW, and eight onshore wind developments, representing 633.9 MW, as preferred bidders.

In all, the projects represented a potential capacity of 1 415.52 MW, leaving 2 309.48 MW still to be allocated, 100 MW of which had been set aside for small-scale projects of less than 5 MW.

Subsequently, 19 additional projects, collectively representing 1 043.9 MW, were also named as preferred bidders by Peters in May, following the second-bid-window evaluation, which took place between March 5 and May 21.

The 47 preferred bids, which represented some 2 459.4 MW of renewables capacity, were expected to collectively invest some R70-billion to develop their projects.

However, Peters recently expressed concern that not all of the window-one projects would be in a position to meet the mid-June financial-closure deadline.

The licensing process for the first 28 projects was completed in April, which Nersa said was a month earlier than had been targeted.

The process included a series of public hearings, which were conducted in the Western Cape, Eastern Cape, Northern Cape and Limpopo provinces between March 1 and March 8.

“All 28 applications met the required criteria, which include technical, financial, economic, regulatory and legal requirements,” Nersa said.

The regulator told Engineering News Online that it had not yet received licence applications from the second-bid-window preferred bidders. But public hearings would be scheduled once these applications had been received.
 

Edited by Creamer Media Reporter

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