Engineering News – 16 April 2015 Energy Minister announces

Engineering News – 16 April 2015 Energy Minister announces

The Department of Energy (DoE) has announced the names of 13 projects that have been accepted in the fourth bidding window of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).

The 13, which would make up 1 121 MW installed capacity on the national grid, were selected from a tightly competitive field of 77 proposals.

Energy Minister Tina Joemat-Pettersson told a media briefing in Cape Town that the successful round four bids, amounting to around R23-billion in value, were expected to create over 7 000 jobs during construction, with 1 000 permanent operational jobs. Over 27 000 jobs are expected to be created over a 20-year period.

The Minister expected financial close of these projects in the fourth quarter of this year, with commissioning of the projects expected from November 2016.

The largest slice of the bids was allocated to onshore wind energy, at 676 MW.

Solar photovoltaic (PV) energy made up 415 MW, with 25 MW being allocated to biomass and 4.7 MW to small hydro.

Six of the 49 solar PV proposals were successful, as were five out of 23 onshore wind projects. About 62% of the successful projects in the fourth round were situated in the Northern Cape, including all of the solar PV projects that were selected. The Northern Cape also scooped two out of the five wind projects.

The Eastern Cape took the largest slice of the onshore wind projects, amounting to around one-third of the successful projects overall.

The recommended preferred bidder for small hydro was in the Free State, and the biomass project in Mpumalanga.

Joemat-Pettersson said the number of proposals indicated the “substantial continuing investor interest” in the South African renewable-energy programme.

The average price of electricity supply had dropped substantially since the first round of bids. The average fully indexed price for the solar PV bidders is 76% lower than it was in the first round, with onshore wind prices falling by almost half.

The average, fully indexed price of onshore wind energy in April 2014 terms is R619/MWh, and R786/MWh for solar PV. Biomass was quoted at R1 450/MWh, with R1 117/MWh for small hydro. The supply prices to Eskom would be contracted for a period of 20 years.

The Minister said she wanted to see swift movement in the implementation of the fourth round and on into a fifth bid submission phase. 

“We don’t have the luxury of time or margins for errors. We will be putting the private sector under tremendous pressure. We will leave no stone unturned to speed up processes to assist in solutions we seek as a collective in this country.”

She said the DoE would need to put pressure on Eskom to sign the power purchase agreements. “The biggest challenge is to get Eskom to evacuate the energy,” she said.

Joemat-Pettersson told journalists that the focus would fall sharply on community participation in the areas in which the projects were based.

“Communities should not be passive recipients but active participants in their destinies.”

The 13 preferred bidders for Window 4 are as follows:

Biomass

Ngodwana Energy Project – 25 MW

On-shore wind

Roggeveld Wind Farm – 140 MW
Karusa Wind Farm – 140 MW
Nxuba Wind Farm – 139 MW
Golden Valley Wind – 117 MW
Oyster Bay Wind Farm – 140 MW

Solar PV

Sirius Solar PV Project One – 75 MW
Droogfontein 2 Solar – 75 MW
Dyason’s Klip 1 – 75 MW
Dyason’s Klip 2 – 75 MW
Konkoonsies II Solar Facility – 75 MW
Aggeneys Solar Project – 40MW

Hydro

Kruisvallei Hydro – 5 MW

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