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Determination on New Generation Capacity Published

September 28, 2020

Department of Mineral Resources and Energy

The mineral resources and energy minister, Gwede Mantashe, has determined that Eskom is to purchase 6800 MW of photo-voltaic and wind power from Independent Power Producers.

The Determination was published in Government Gazette 43734 in terms of Section 34(1) of the Electricity Regulation Act.

The electricity will be purchased between 2022 and 2024.

Other new generation capacity to be procured includes 513 MW from storage for 2022, 3000 MW from gas for 2024 to 2027 and 1500 MW from coal for 2023 to 2027.

The Determination stipulates that electricity produced from the new generation capacity “shall be procured through one or more tendering procedures which are fair, equitable, transparent, competitive and cost-effective and shall constitute IPP procurement programmes as contemplated in the Regulations (“procurement programmes”)”.

The department is responsible for procuring the energy.

Meanwhile, new authorisation fees for the National Nuclear Regulator have been published in Gazette 43734.

The energy department published the fees in terms of Section 28 of the National Nuclear Regulator Act.

The fees refer to applications for the granting of nuclear authorisation as well as annual authorisation renewal fees.

They cover the period 1 April 2020 to 31 March 2021.

Category 1 consisting of small users, laboratories and refurbishes will pay an authorisation fee of R66 978 for 2020/21 while category 5 comprising large operators, including major mining and mineral processing facilities, will pay R1 272 596.

Category 3 comprising fertilizers and other lesser mining and mineral processing facilities will be charged an authorization fee of R468 851 for 2020/21.

Following the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP) Bidders’ Conference held today, the department released a statement outlining key messages from the virtual conference.

The IPP Office described the RMIPPPP as a “one-of-a-kind output-based Request for Proposal (RFP) that seeks to procure an optimal solution to meet grid requirements, without being prescriptive in terms of the technology to be procured”.

The IPP Office indicated that the RFP specifies a long-stop date for the last permissible commercial operation date as the end of June 2022.

The department reminded all interested parties that the next milestone of the RMIPPPP is the bid submission date of 24 November 2020.

“Preferred Bidders are expected to be announced during December 2020, with commercial and financial close anticipated within 4 months of the Preferred Bidders announcement.”