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Interest for City’s procurement of power proposal

Date: 2021-11-12 10:21:09

Interest for City’s procurement of power proposal

KwaZulu-Natal has a strong market for power generation. This is the assertion made by the City following its assessment of proposals that were submitted through the Request for Information (RFI) for the possible procurement of 400MW of power from independent power producers.

The RFI, which is part of the Municipal Independent Power Producer Programme (MIPPP), was advertised on 9 July and closed on 10 September.

It is in line with the City’s Energy Transition Policy which aims to create a resilient, integrated Municipal energy system through sourcing 40 percent of electricity from renewable-energy sources by 2030 and 100 percent by 2050.
Manager for Renewable Energy Sbu Ntshalintshali said the City received “overwhelming support from various organisations, from private developers to finance institutions within the country and at an international level”.

“The programme generated interest from 104 potential projects, of which 96 projects fall under energy generation, and eight projects represent finance institutions which are mostly operating at the continental level,” said Ntshalintshali.

He said the 96 power generation projects represent a combined capacity of 16477MW, which is more than enough to power the City nine times.

Projects included a range of individual and hybrid power generation from a diverse mix of energy sources. The individual generation assets contributed a total capacity of 8857MW, of which natural gas is the largest generation technology group at 40 percent followed by Solar PV at 23 percent, and Waste to Energy at 10 percent, to mention the top three.

“It is noted that more than 25 percent of the projects have completed or require no environmental impact assessment (EIA) to proceed. Some projects have proposed to be located within the Special Economic Zones and some proposed less capacity to trigger EIA. More than 60 percent of the projects are in the pre-approval stage for funding and require signing of the Power Purchase Agreement to complete deal structuring and financial close,” elaborated Ntshalintshali.

He said a majority of the projects will be able to reach commercial operation in July 2025 as stipulated in the RFI. The City’s MIPPP is likely to create 4 000 jobs in the last quarter of 2022, on condition that all regulatory approvals do not delay the implementation process.