RISK MITIGATION & GAS IPP PROGRAMMES

The RFP follows the same format as previous IPP Procurement Programmes, and includes:

• Part A (general requirements, rules and provisions) provides general information to the bidder;
• Part B (functionality criteria requirements) details the functionality criteria that must be met by the bidder for a bid response to be considered by the department as a compliant bid; and
• Part C (evaluation criteria requirements) details the evaluation procedure and the evaluation criteria to be applied by the department in evaluating and comparing compliant bids.

Within the confines of the current preferential procurement regulatory environment, thresholds and targets may no longer be set for economic development elements and it is not included as compulsory qualification criteria to be a compliant bid response. Bidders may therefore elect to make commitments under the specific goals on any of the economic development elements, or not at all.

The GIPPPP will provide for long term power purchase agreements up to 20 years from the cod date.

The timelines for the release of the RFP in the market is 14 December 2023, Bid Submission is 30 August 2024. Preferred Bidder announcement is targeted approximately 3 (three) months post the Bid Submission Date and Financial Close will be approximately 4 (four) months post Preferred Bidder announcement.

The 10 points under the regulations of the PPPFA is allocated to specific goals to promote Economic Development. The Economic Development commitments remain a cornerstone of the IPP Programmes.

The procurer, in respect of the procurement programme, will be the Department of Mineral Resources and Energy and the electricity must be purchased by Eskom Holdings SOC Limited designated as the buyer.

The DMRE launched the Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP) on the 23rd of august 2020. The objective of the RMIPPPP is to fill the current short-term supply gap, alleviate the current electricity supply constraints and reduce the extensive utilisation of diesel-based peaking electrical generators.

In response to the Risk Mitigation determination, the 2 000 mw of new generation/supply capacity will be procured from a range of energy technologies and are based on the following criteria:

• It will be technology agnostic;
• Based on the plant-performance needs of the electricity system operator;
• It will procure dispatchable flexible generation that should be able to provide energy, capacity and ancillary services;
• Should be able to operate between 5h00 to 21h30;
• It must have an AGC load following ability, flexible capacity factor and must be “scalable” with changing capacity requirements; and
• Bidder could bid in a portfolio manner with the objective of combining a range of technologies that will meet the system operator demands, but also, through the use of a cost optimal approach, combine technologies to reduce the average bid tariff and ultimately the cost of electricity to the end consumer.