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Risk Mitigation IPP Procurement Programme on Track

March 23, 2021

Department of Mineral Resources

Preferred bidders for the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP) have been announced.

The mineral resources and energy minister, Gwede Mantashe, announced the preferred bidders at a media briefing yesterday.

The RMIPPPP was released to the market in August 2020.

According to the minister, the “aim was to alleviate the electricity supply constraints and to reduce the extensive utilisation of diesel-based peaking electrical generators in the medium-to-long-term”.

At the close of the Bid Submission on 22 December 2020, 28 bid responses had been received with a potential contracted capacity of approximately five thousand one hundred and seventeen megawatts (5 117MW).

The minister pointed out that the “quantity and quality of the bid responses and potential megawatt of contracted capacity allowed for a competitive price evaluation”.

8 Preferred Bids totalling one thousand eight hundred and forty-five megawatts (1 845MW) and a further 3 Eligible Bids totalling one hundred and fifty megawatts (150MW) were selected.

According to the minister, the “three Eligible Bids are subject to value for money proposition in line with the provisions in the Request for Proposal”.

The Preferred Bidders are required to reach Financial Close by no later than the end of July 2021 with connection to the grid targeted for August 2022.

The minister also announced that Renewable Energy IPP Procurement Programme Bid Window 5 has been released.

Out of the 2 600 megawatts from Bid Window 5, 1 600 megawatts will be from wind and 1 000  megawatts from Solar PV.

‘Given the energy challenges that we are facing the objective is to get these projects connected to the grid as soon as possible”, he said.

Bid submissions are invited until 4 August 2021.

The minister also announced that four more Requests for Proposals will be released within the next 12 months.

These will include:

• Two thousand six hundred megawatts (2 600MW) from renewable energy;
• Three thousand megawatts (3 000MW) from gas;
• One thousand five hundred megawatts (1 500MW) from coal; and
• Five hundred and thirteen megawatts (513MW) from battery storage.

The minister confirmed additional Determinations will be issued to Eskom and Municipalities as and when requests are received.

The department is also “working with the necessary speed to review the licensing threshold for increased embedded generation”.

Meanwhile, in a statement, the department announced the setting up of the Public Petroleum Products Act Compliance Forum.

It consists of “petroleum industry stakeholders including wholesalers and retail associations, and law enforcement agencies such as the SAPS and SARS, with the aim of finding solutions to curb non-compliance”.

The department points out that the “rampant illegal and illicit fuel trade has prompted the need to collaborate with all petroleum industry stakeholders, including the South African Revenue Service (SARS) and the South African Police Services (SAPS), as part of the intervention to create a public policing forum that enforces the provisions of the Petroleum Products Act No. 120 of 1977 as amended (PPA)”.

A list of regional inspectors to which members of the public are invited to report non-compliant petroleum operators is provided.