South Africa to Double Clean-Power Plans as New Bidders Named

South Africa said it plans to more than double the amount of renewable power it gets from private companies by securing a further 6,300 megawatts as it named preferred bidders for contracts to build 13 clean-energy projects.

Scatec Solar AS, Biotherm Energy, Sappi Ltd., Sun Edison LLC and Enel Green Power were among the companies provisionally selected to build solar, wind, biomass and hydroelectric plants that will add 1,121 megawatts of power to the national grid,the Department of Energy said in a statement. Financing for the projects should be completed in the fourth quarter, with plant commissioning due to start in November 2016.

“This brings it to a total of 79 projects approved by the Department of Energy with a capacity of 5,243 megawatts” in four of five bid rounds, Energy Minister Tina Joemat-Pettersson told reporters in Cape Town Thursday. “This represents a massive investment of 168 billion rand ($14 billion) in economic infrastructure in our country.”

South Africa is looking to tap new sources of energy and encourage more private companies to become involved in generation as power demand exceeds supply. State utility Eskom Holdings SOC Ltd., which supplies about 95 percent of the nation’s electricity, has implemented rolling blackouts for the past five days to avert a collapse of the national grid.

Round Five

A fifth bid round for projects to generate 1,800 megawatts of clean energy will open by June, following which the government will initiate a new set of tenders, Joemat-Pettersson said. She plans to ask the national power regulator for a dispensation that will enable the government to buy an additional 6,300 megawatts of renewable energy from private producers. The fifth round forms part of the additional procurement plan.

The bidding process will be simplified and companies will be able to resubmit projects that weren’t selected in previous rounds, she said.

The government has called for bids from private companies to supply 2,500 megawatts of electricity from coal-fired power stations and expects to announce preferred bidders by year-end. It also aims to procure 3,126 megawatts of power generated from gas, and will release requests for information by the end of April.

Joemat-Pettersson’s department is also designing a process to obtain 800 megawatts of power from co-generation plants that use waste, such as heat or gas produced during industrial processes, to generate electricity. The ministry will issue requests for proposals by the end of the month and preferred bidders will be announced in the third quarter, she said.

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