Next 19 renewables projects to close ‘in April’, as final touches are put to new tender

5th April 2013 By: Terence Creamer - Creamer Media Editor

South Africa’s Department of Energy (DoE) has confirmed that the financial-close deadline for the 19 second-bid-window projects identified under the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) has been delayed to the fourth week of April, from the initial deadline of the end March, while the release date for the request for proposals (RFP) for the third bid window has been shifted to the end of this month.

The need to reschedule the financial-close deadline arose in order to accommodate the securing of government approvals that are required before the contracts could be signed.

Spokesperson Thandiwe Maimane said the postponement would provide the department with the opportunity to finalise all the contracts, including the power purchase agreements, direct agreements and implementation agreements for projects representing 1 043.9 MW of capacity and an investment value of around R28-billion.

In parallel, the DoE was moving ahead with processes to secure internal approvals for the third-bid-window RFP, which will reportedly incorporate the improvements that have already been outlined in various briefing notes released during the first two bid windows. Adjustments would also be made to the economic development obligations faced by bidders.

It was not yet clear how much capacity would be set aside from procurement during the third bidding round, with 1 165 MW remaining for allocation from the initial determination, which opened the way for the procurement of 3 725 MW of renewables projects by 2016.

However, a further determination was released by Energy Minister Dipuo Peters in December catering for addition REIPPPP procurements of 3 200 MW by 2020.

The allocation for various technologies was also still being finalised, but Maimane indicated that the third round would probably be dominated by onshore wind, followed by Solar photovoltaic (PV). But the department was also “mindful of the need to allocate additional megawatts for concentrate solar power in the third window”.

Also under review was the schedule for the subsequent bid, which efforts reportedly being made to ensure that government is in a position to procure at least 1 000 MW of renewable energy a year.

“The department intends to align all bid submission dates for the subsequent windows to August of each year. The announcement for the preferred bidders should be every year in November subject to the availability of the megawatts. Therefore, projects are expected to close within six months from the announcement date,” Maimane reports.

However, the actual timeframe for the different windows would be released with the RFP to allow bidders time to plan for the subsequent windows.