RENEWABLE IPP PROCUREMENT PROGRAMME

BID WINDOW 5

LINK: https://www.ipp-renewables.co.za/

The Department of Mineral Resources and Energy (DMRE) has launched the Request for Proposals (RFP) for the Fifth Bid Window under the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).

This procurement bid window is the first to be released in line with the Ministerial Determination, promulgated on 25th September 2020, which seeks to procure 11 813 MW of power from various sources including renewable energy, storage, gas and coal.

The RFP calls for proposals from Independent Power Producers (IPPs) to develop new generation capacity of 2 600 MW, including 1 600 MW from onshore wind energy and 1 000 MW from Solar Photovoltaic (Solar PV) power plants, in line with President Cyril Ramaphosa’s commitment in his 2021 State of the Nation Address (SONA) to increase South Africa’s generation capacity and ensure the security of energy supply to society.

The project sizes will range from a minimum of 1 MW to a maximum of 140 MW (for Onshore Wind) and 75 MW (for Solar PV).

Given the energy challenges the country is facing the qualification criteria has been developed to promote the participation of projects that are fully developed and will be able to be constructed and connected to the national grid as soon as 12 months from Commercial Close, but not later than 24 months post Commercial Close.

Notwithstanding its main objective of procuring new generation capacity, the REIPPPP is one of the key programmes in the country that can stimulate the development of the economy and address the socio-economic challenges that South Africa is facing, at the same time. The RFP is therefore structured to strategically respond to the socio-economic context currently facing the country and Economic Development qualification criteria is included as a central component of REIPPPP Bid Window 5. The RFP for BW 5 will therefore aim in:

• Promoting economic transformation in order to enable meaningful participation of black people in the economy;
• Achieving a substantial change in the racial composition of ownership and management structures and in the skilled occupations of existing and new enterprises;
• Increasing the extent to which communities, workers. cooperatives and other collective enterprises own and manage existing and new enterprises and increasing their access to economic activities, infrastructure and skills training;
• Increasing the extent to which black women, in particular, own and manage existing and new enterprises, and increasing their access to economic activities, infrastructure and skills training; and
• Empowering rural and local communities through socio-economic initiatives.

The lack of activity in the Renewable Energy market over the last 5 years has resulted in local manufacturing capacity, which had just started to grow exponentially in South Africa, being significantly eroded. The DMRE and Department of Trade, Industry and Competition (dtic) view the REIPPPP Bid Window 5 as an exciting opportunity to re-ignite the Renewable Energy sector. The bid window will incentivise the inclusion of local content to stimulate local manufacturing capacity and local businesses, more specifically businesses owned by black people, and the active participation of black people in all aspects of the Renewable Energy sector value chain.

The Economic Development framework is based on the bespoke scorecards previously used under the Renewable Energy IPP Programmes, but have been amended to be more aligned with the Amended BBBEE Codes. Progressive thresholds and targets have been set for development commitments during the construction and the operational lifetime of IPPs.

The Renewable IPP Procurement approach, systems and procedures have been well developed and tested and improved over every bid window. Qualifying criteria have been further adapted, refined and scaled down to bring about even more efficiencies in the bid process, and ensure the best price for the consumer.

The DMRE will convene a Bidders’ Conference, to be hosted on an e-platform, during April 2021, to provide more information on the qualifying criteria and bid submission expectations.

The payment of a non-refundable fee of R 25 000 (twenty five thousand rand) net of all charges, entitles each prospective Bidder to have access to the RFP and to submit one project at the bid Submission Date.

If the prospective Bidder intends to submit more than one project they will need to make an additional payment of R 25 000 (twenty five thousand rand) net of all charges per additional project.

The required fee is payable by means of a direct deposit or electronic funds transfer, which fee must be made without set-off or deduction. All payments must be made in immediately cleared funds to the Project Development Fund established by National Treasury:

Account Name: GTAC - IPP

Bank: Nedbank

Account Type: Current

Account Number: 1068872608

Branch Name: Corporate Client Services, Johannesburg

Branch Code: 198765

SWIFT Code: NEDSZAJJ

A potential bidder will also be updated via briefing notes of any new developments, important information on the bidding process and key dates around the bid submission process, etc.