In an ongoing effort to ensure energy security and reduce the cost of electricity, Electricity and Energy Minister, Dr Kgosientsho Ramokgopa, has announced the appointment of five preferred bidders under the Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP) Bid Window 3.
These preferred bidders are expected to make a total investment of R9.5 billion into the South African economy.
The Battery Energy Storage Programme is a critical initiative aimed at enhancing South Africa’s power system by providing essential ancillary services and increasing grid capacity through energy storage.
“What we are announcing today… is another ‘peaker’ that is going to help us during the peak, instead of relying more and more on the open cycle gas turbines and on burning diesel.
“We are going to use that excess generation capacity that we generated during the day when the sun was out … we store it and at the time when we need it, draw it. We are going to draw it from the batteries and [it will] be discharged and give us the kind capacity that we need. We are working on ensuring that we have additional generation capacity drawing from the technology that is out there in the world,” Ramokgopa said at a media briefing on Friday.
WATCH | Bid Window 3 announcement
BESIPPPP Bid Window 3 is a site-specific procurement round designed to facilitate the procurement of up to 616 megawatts (MW) from facilities that will provide capacity, energy and ancillary services to the National Transmission Company of South Africa (NTCSA) as the buyer, at five specified sites in the Free State supply area.
“This is part of our quest to ensure that we achieve energy security, bring down the cost of electricity – because this solution has been shown to be the most cost competitive of the energy solutions that we can have.
“A combination of solar BPV [biological photovoltaics], wind and now storage capacity means that we are flattening the cost curve of electricity. We will make household lives more bearable – disposable income and more significantly for industry.
“Electricity is the backbone of the economy. If the lights are off, there is no economy.”
The department received a total of 33 bid responses on 28 November 2024.
The BESIPPPP BW3 round was again found to be highly competitive, with a marked increase in the number of bids relative to the previous bid windows, resulting in a 40% and 8% decrease in the average evaluation Price, compared to Bid Window 1 and 2 prices respectively.
The five preferred bidders have made the following commitments:
• Black Shareholding: will contract at a minimum of 40% in the IPP Project Companies; up to 30% black shareholding by construction contractors; and up to 42% in operations contractors.
• Total Job Opportunities: 852 job opportunities for South African citizens (measured in job years), during construction and operations.
• Local Content Spend: Over R3.7 billion during construction and during the operation and maintenance phases.
• Preferential Procurement: Over R3 billion from Broad-Based Black Economic Empowerment (B-BBEE) companies, R1.3 billion from black-owned enterprises, R1.1 billion from Qualifying Small Enterprises (QSEs) and Exempted Micro Enterprises (EMEs) as well as R562 million from black women companies.
• Supplier development, skills development, bursaries for black students, skills development for Black disabled people, enterprise development and socio-economic development initiatives: R184 million over the lifetime of the projects.
–SAnews.gov.za
