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DoE Media Statement: Preferred Bidders Press Conference

Durban, 7 December 2011: The Department of Energy published a Request for Proposals (RFP) on the 3rd of August 2011 requesting Independent Power Producers to submit proposals for the first window closing on the 4th of November 2011. All bidders intending to bid for the first and the second window were required to attend a compulsory Bidders Conference held on the 14th of September 2011.

The conference was compulsory for all bidders intending to submit their bids for the first and the second window as per the provisions of the RFP. Most bidders were aiming for the first window, but some were not ready given the readiness criteria outlined in the RFP.

In accordance with the provisions of the RFP, all bidders intending to submit for the first window were requested to submit their bids as from the 3rd of August, whilst the closing date was 12h00 on the 4th of November 2011. The Department received 53 bids and the received bids cut across all the different technologies.

Bids received on phase 1 were on Solar PV, Solar CSP, Wind and Small Hydro. It was expected that wind and solar would dominate the bids given the South African environment. You will notice that even the determination gave wind and solar more MW allocation compared to the other technologies.

The evaluation of the received 53 bids started on 4th of November and was concluded on 28 November 2011. The venue where evaluation took place was under 24 hour voice and visual CCTV monitoring. The evaluation team was composed of:

  1. International reviewers:
    1. Legal
    2. Technical
    3. Finance
    4. Governance
    5. South Africa’s legal evaluators were:
      1. Bowman Gilfillan
      2. Edward Nathan Sonnebergs
      3. Ledwaba Mazwai &
      4. Webber Wentzel
      5. South Africa’s technical evaluators:
        1. Matt Macdonald
        2. South Africa’s financial evaluators were:
          1. Ernst & Young
          2. PWC

The following six streams were evaluated: 1. Environmental; 2. Land; 3. Commercial legal; 4. Economic development; 5. Financial; & 6. Technical. Bidders had to pass all six streams in order to be selected Preferred bidders.

Evaluation Outcomes:

Of the total 3 725 MW determined by the Minister under section 34 of the Electricity Regulation Act, in concurrence with NERSA, 3 625 MW was made available for large scale renewable projects (100 MW has been reserved for Small Projects).

From phase 1 of the large scale renewable projects, 53 bids amounting to 2 128 MW were received across Wind, Solar PV, Solar CSP and Small Hydro. The evaluation resulted in 28 bids with a total MW of 1 416 being selected as Preferred Bidders. These were from the following technologies: 1. Solar PV (631.53 MW); 2. Solar CSP (150 MW) & 3. Wind (633.99 MW).

Based on the allocation from phase 1 as indicated above, a total of 2 209 MW is still to be allocated from the remaining phases to make up the required total of 3 625 MW.

The evaluation outcomes were evaluated by the independent review team in the following areas:

  1. Independent Legal Review
  2. Independent Technical Review
  3. Financial cross-moderation
  4. Governance review.

The Department is confident that the Preferred Bidders will successfully conclude their project arrangements in order to meet the Financial Close deadline of 30th June 2012 and for construction to commence shortly thereafter.

–          Ends

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