Wednesday, December 7, 2011

South Africa approves 28 bidders for 1416 MW renewable energy tender – 3725 MW/$12 billion USD procurement process on track

South Africa approved 28 bidders for a renewable energy tender with projects totaling 1416 megawatts. The approved bidders have until the end of June, 2012 to confirm financing, with construction to begin shortly thereafter, the Energy Department of South Africa stated.

Of the projects selected, 632 MW were for solar photovoltaic projects; 150 MW, for concentrated solar power; and 634 MW, for wind developments.

The department is holding five tenders to allocate 3725 megawatts valued around $12 billion USD over the next two years. In the first round of bidding, the department received 53 bids for a total of 2128 megawatts in projects. It selected 28 out of the 53. It now has 2209 megawatts that companies can bid for in the remaining tenders.

Vestas is involved in two of the bidding groups selected, representing 138 megawatts, as is South African solar company Momentous Energy, which will obtain some of the products from Chinese companies.

One of China's top wind turbine producers, Sinovel Wind Co., also was selected, with one of the larger bids, a person close to the matter said.

About 90% of South Africa's electricity comes from coal-fired power plants. By 2030, the country aims to lift renewable sources to 8% of the energy mix, up from less than 1% now.

In addition to development in the private sector, state-owned power company Eskom Holdings Ltd. is also raising money to develop its own wind and solar projects. Eskom last month signed a $250 million USD loan agreement with the World Bank to build 200 megawatts of their own solar and wind projects. The company also is in talks with the European Investment Bank to obtain €50 million, or about $70 million, for building solar PV projects.

The South African government on Wednesday also said it will create the South African Renewable Initiative. Working with the European Investment Bank, the government plans to raise financing internationally to be used on renewable energy projects. Germany said it intends to support the fund.

Source: (in part) Wall Street Journal – December 7, 2011 edition

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