- City targets at least 5 MW of waste to energy capacity under long term PPAs of up to 20 years.
- Programme aims to cut reliance on Eskom and reduce electricity costs and emissions.
- Tender submissions close on 29 May 2026.
The City of Cape Town has launched a municipal level waste to energy procurement programme in a move to diversify its electricity supply and reduce dependence on Eskom.
The initiative will see the City procure bulk electricity from Independent Power Producers through a competitive Power Purchase Agreement model. The programme targets a minimum of 5 MW of capacity, subject to commercial viability, with contracts of up to 20 years.
To qualify, projects must deliver electricity at a price lower than Eskom tariffs while also achieving lower emissions than the national grid. The City confirmed that one or multiple PPAs may be awarded depending on financial and technical feasibility.
All environmental benefits associated with the projects, including Renewable Energy Certificates and carbon credits, will be transferred to the municipality.
Cape Town currently spends about 70% of its tariff income on bulk electricity purchases from Eskom, making it the single largest cost driver in the City’s energy budget. Officials say reducing this exposure is critical to limiting tariff increases and protecting both businesses and households from rising energy costs.
The waste to energy programme forms part of a broader strategy to diversify supply and introduce cleaner and more reliable generation sources into the municipal energy mix. It also represents one of the first municipal procurements in South Africa to use a competitive PPA model for waste to energy.
The City said the initiative links waste management and electricity generation, supporting a circular economy approach while lowering emissions. It also opens the municipal grid to technologies beyond traditional renewable energy such as solar PV and wind.
Independent Power Producers may deploy either existing or new build facilities but must use proven utility scale waste to energy technologies. Projects may optionally include battery energy storage systems.
Developers will be responsible for securing their own waste feedstock, as the City will not facilitate supply agreements. They must also manage all by products and waste streams in compliance with applicable regulations.
Projects can be located anywhere in South Africa, provided developers cover grid connection and wheeling costs where required and meet all technical standards.
The tender process follows standard public procurement rules, with competitive bidding required for contracts exceeding R200000. Submissions for the waste to energy programme close on 29 May 2026.
To bid for a City of Cape Town tender, prospective suppliers must:
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Download and refer to the City’s Tender Guide
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Register on the Central Supplier Database (CSD)
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Register on the City of Cape Town’s Supplier Database
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Access and review available opportunities on the Tender Portal
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Download the relevant tender documents
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Submit their bids before the specified deadline
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Ensure that all required compliance documents are included
Failure to meet any of the requirements or deadlines may result in disqualification from the bidding process.
Other tender out – Energy Trader 500 MW
The City is set to become the first municipality in South Africa to procure electricity at scale from licenced energy traders and aggregators. A new Energy Trader Tender aims to procure 500 MW through Power Purchase Agreements (PPAs) spanning one to 10 years from a variety of power generation technologies, including solar. Tenderers have until 13 May 2026 to respond to this innovative tender aimed at enhancing the resilience of Cape Town, by diversifying its energy mix and moving away from reliance on Eskom’s rising electricity costs. This is also a project under Mayor Geordin Hill-Lewis’s Mayoral Priority Programme on Energy.
Author: Bryan Groenendaal
