30 October 2013 by

Renewable Energy IPP Procurement Programme – Third round bid winners announced

Preferred bidders for the Third Bid Submission Phase were announced today by the Minister of Energy Ben Martins. The Department of Energy said they had received 93 Bid Responses on the Third Bid Submission Date and has sent letters of appointment as Preferred Bidders to 17 Bidders who submitted Bid Responses on the Third Bid Submission Date.

According to Kieran Whyte, director and National Practice Head of the Projects and Infrastructure Practice at Cliffe Dekker Hofmeyr, “Cliffe Dekker Hofmeyr is advising on one Concentrated Solar (CSP) project;  one Landfill Gas project; two  Onshore Wind projects and one Solar Photovoltaic project that received Preferred Bidder Status in Round 3 of the REIPPPP. We have also advised four additional preferred bidder projects on an ad hoc basis.

“We are under mandate on a number of other Onshore Wind and Solar Photovoltaic projects that submitted bids under Round 3 that could still be selected as additional Preferred Bidders as outlined by the Department of Energy. The Department noted in an announcement on their website that “… a large number of very competitive Bid Responses were submitted for the Third Bid Submission Date in the Onshore Wind and Solar Photovoltaic Technologies, and the Department is considering the appointment of additional Preferred Bidders for those Technologies from the remaining Compliant Bidders. As such, the Preferred Bidders that have been appointed in those technologies may not be the only Preferred Bidders that are appointed in those technologies for the Third Bid Submission Date, and no final decision on this has been taken at this time. The Department will make a further announcement regarding its decision in this regard in due course, and is intending to do so by not later than 20 November 2013."

Whyte said that both the firm’s Cape Town and Johannesburg offices were involved in the projects across many practice areas from projects and infrastructure, project finance, environmental, corporate and commercial, intellectual property, BEE, construction and engineering, employment including immigration, tax including foreign exchange as well as customs and excise, competition, public procurement and administrative law. This made teamwork essential.

The Department of Energy's (DoE) Renewable Energy Independent  Power Producers Procurement Programme (REIPPPP) was launched in August 2011 and provides for the procurement  of 6725 MW of renewable energy from renewable energy sources, such as onshore wind, concentrated solar power, solar photovoltaic, biomass, biogas, landfill gas and small hydro. The REIPPPP is being conducted in six phases. 2459.3 MW of energy has been awarded in the first two bid submission phases

The Request for Proposals was updated  for the Third Bid Submission Phase, and was released in May 2013. The DoE introduced a number of significant changes to the RFP including increased local content and economic development. Bids for the Third Bid Submission Phase were submitted to the DoE on 19 August 2013. The target allocation for the Third Bid Submission Phase under the RFP was 1,473.1 MW. The Preferred Bidders appointed today have a total contracted capacity of 1471.5 MW. Under the current schedule legal close is anticipated to take place before the end of July 2014.

The DoE estimates that by the end of the Sixth Bid Submission, the REIPPPP will have attracted investment to the value of in excess of R100 billion over its lifetime in the renewable energy sector. According to Jay Govender, director in the Projects and Infrastructure Practice at Cliffe Dekker Hofmeyr, "This confirms the importance of the REIPPPP to South Africa's growing energy demands and the need to develop natural resources in an environmentally friendly and sustainable manner, whilst at the same time importantly facilitating and steering the development of job creation and South African participation in the energy sector".

 

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