Solar energy and wind power in South Africa

Danish wind power manufacturer Vestas emerged as a major winner in South Africa’s latest tender round for new renewable energy projects designed to boost the country’s energy security and drive down emissions.

South Africa’s Energy Minister, Dipuo Peters, yesterday unveiled the preferred bidders for 19 new energy projects, most of which were wind energy, solar energy (photovoltaic and concentrating solar power) and hydro power, potentially creating 1,044 MW of capacity.

Vestas announced it won preferred bidder status for five of those projects, representing 297MW of the 562MW of wind turbines capacity allocated. However, it refused to disclose any further details, saying only that a statement would be released on the confirmation of contracts.

South Africa plans to build more than 3.5GW of new renewables by 2016 from its Renewable Energy IPP bidding rounds to help reduce the country’s reliance on coal power.

Peters said the total projects could deliver a potential investment of 100bn rand (£7.6bn). Many of the proposed projects announced yesterday also include plans to offer jobs or community shareholder schemes to local residents.

Bidders now have until the end of the year to show the projects are commercially viable, or potentially see their plans scrapped, in which case the government would retender the allocated capacity in future rounds.

Peters said the department had received 79 bids for the latest round of projects, 51 of which met the criteria given in the request for proposals.

She also warned that there would be little flexibility for any winning bidder from the first 1,416MW round that failed to reach the June 2012 deadline to secure financial close on their projects.

"The department is monitoring these bidders very closely with regards to their commitments," she said. "So far we have received requests for amendments from some of the preferred bidders but, government will be careful not allow any changes that seek to compromise the procurement process."

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