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, which is 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);
• the 450 MW Karpowership SA Richards Bay facility – a gas-to-power plant based on imported LNG;
• a 320 MW Karpowership SA Saldanha facility – a gas-to-power plant based on imported LNG;
• 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; and
• the 75 MW Umoyilanga Energy – a hybrid facility comprising solar PV, wind and a BESS.

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

The Scatec projects will comprise three hybrid plants with solar PV technology and BESSs, in the Northern Cape.

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

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
Not stated.

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

Planned Start/End Date
The initial eight projects were expected to reach financial close by no later than the end of July 2021 and be connected to the grid from August 2022. However, the deadline for financial close has been shifted to September 30, owing to several processing delays.

The Scatec projects are required to achieve financial close by the end of September 2021, with grid connection by the end of 2022.

Latest Developments
The DMRE has attributed the delay of the first eight RMIPPPPs to a lack of readiness by government and Eskom rather than the bidders.

However, a legal challenge against the three Karpowership SA projects, which comprise 1 200 MW of the nearly 2 000 MW programme, also posed a risk to the RMIPPPPs.

The legal case, which had been brought by DNG Energy, was scheduled to be heard from September 9 to 13 and the ruling is expected in the same week.

In addition, the Department of Forestry, Fisheries and the Environment (DFFE) refused to grant environmental authorisation for the three Karpowership SA projects, while several objections to the licensing of the projects were also raised during recent National Energy Regulator of South Africa hearings.

Karpowership SA and others have appealed the DFFE decision, which opponents to the projects have welcomed and have called to be upheld.

In their appeal against the DFFE refusal, the environmental assessment practitioner (EAP) and Karpowership SA provided noise levels for their ships operating in Ghana, after the lack of an underwater noise assessment was highlighted as a key flaw in the original environmental-impact assessments (EIAs).

Karpowership SA argued that, based on the information, it was concluded that the powerships have a low impact on marine ecology, thus, “proving” that Karpowership SA’s operations will not have a negative impact on the marine life at the ports.

Green Connection community outreach coordinator Neville van Rooy has said, however, that these noise studies have been critically analysed by an expert and found to be neither credible nor independent and, therefore, not a sound basis for decision-making.

Further, additional evidence on underwater noise was introduced for the first time in the final EIA report, at which point the public was not afforded the right to comment, consequently also depriving the public of the right to controvert such evidence, Van Rooy has added.

Green Connection has now submitted its comments on Karpowership SA’s appeal and remains “extremely concerned” that the powership projects could undermine other important local economic sectors, such as aquaculture, which is also an important contributor to the local economy.

The organisation believes that several renewable-energy options could fill the short-term electricity generation gap, with less greenhouse-gas emissions than the powerships, more local opportunities and “which do not harm the fragile marine environment”.

The organisation also believes that the controversial powerships are not needed and is hopeful that Creecy will uphold her department’s refusal to authorise these floating power stations.

Karpowership SA claims that “the EIA clearly lists the location where the floating power plant will be moored . . . into Big Bay area, in the Port of Saldanha. The Big Bay area is not a fishing zone and never was. We can safely assume that the operations of Karpowership SA will not threaten the livelihoods of small-scale fishermen because they are not operating in a fishing zone”.

This is disputed by small-scale fishers, who, according to Coastal Links Saldanha Bay Community’s Natalie-Jane van Wyk, “have been fishing here for decades. For generations, our livelihoods have come from the ocean”.

Key Contracts, Suppliers and Consultants
None stated.

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