Public Procurement Programme Reforms – A step in the right direction for South Africa’s renewable energy future
The South African Wind Energy Association (SAWEA) acknowledges the key interventions to reform the public procurement programme, announced by the Minister of Electricity and Energy, Kgosientsho Ramokgopa, during his press briefing on 21 October 2024. Developed through extensive stakeholder consultations, including SAWEA’s participation, these interventions reflect an analysis of the challenges and lessons learned from previous Bid Windows (BWs).
The Minister emphasised the importance of aligning the public procurement process with ongoing power sector reforms. SAWEA agrees with the urgency of aligning the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) with broader sector developments, addressing current challenges, and accelerating the timely connection of renewable energy, particularly wind energy, to the grid.
The Independent Power Producer Office (IPPO), through the Minister’s presentation, has demonstrated the socio-economic benefits of renewable energy projects which advocates for refocusing efforts on optimising the REIPPPP. SAWEA sees significant opportunities to scale these achievements by addressing challenges such as grid access, policy alignment, and consistency in issuing REIPPPP rounds as a positive signal to the market. A balanced approach is needed; one that addresses immediate needs while setting a sustainable path for both public and private procurement of wind energy, as part of the evolving energy market.
Maintaining Momentum: Immediate Solutions supported by the Wind Industry
Considering the setbacks of previous BWs, SAWEA has consistently advocated for a balanced approach to grid capacity allocation, ensuring both public and private procurement processes work synergistically. The sector’s recovery depends on addressing the current wind energy deficit with a well-considered approach to meeting the IRP2019 energy mix ambitions.
We must focus on the short-term resolution of curtailment, making available some 3.8GW of capacity for wind energy. Once this new capacity becomes available, targeted wind-specific procurement rounds will ensure that wind remains a key contributor to South Africa’s transition.
As the Minister highlighted, SAWEA agrees that either smaller, more frequent REIPPPP rounds or, significantly larger procurement capacities per round, are needed to provide certainty and consistency for the programme’s success and for the broader renewable energy market.
Reforms critical to sustaining the Public Procurement Programme
The success of wind energy in South Africa’s energy transition and security remains SAWEA’s priority. The stop-start nature of the public procurement programme has hindered the steady uptake of wind energy. To ensure a more sustainable approach, SAWEA generally supports the interventions proposed by the Minister and IPPO.
While the reforms are anchored by the Electricity Regulation Act Amendment Bill (2023), which introduces critical changes to electricity generation and transmission, including provisions for a wholesale electricity market and the establishment of an Independent Transmission System Operator (TSO), SAWEA believes that these reforms need to be supported by improved grid allocation processes and timelines to ensure both public and private procurement advancement. The interventions need to be prioritised, operationalised and balanced to ensure the greatest impact. This is essential for stimulating the market and ensuring fair access to the transmission grid for renewable energy projects.
If implemented in a timely and transparent manner, these interventions present significant opportunities for wind energy to play a growing role in South Africa’s energy mix, as outlined in the IRP2019. SAWEA will continue to engage with the Minister and IPPO to support the country’s socio-economic development, energy security, and environmental objectives.
