City of Cape Town issues IPP tender for despatchable reserve power

  • The City of Cape Town powers ahead by issuing another tender in a series aimed at mitigating the impact of load-shedding and diversifying its supply of energy and reducing reliance on Eskom.
  • This is in line with its plan of adding independent power to the City’s grid.
The City intends on procuring power from existing generators in line with its objective of being able to mitigate against load-shedding over time. A two-pronged procurement structure will be followed, allowing bidders to supplement dispatchable/ reserve power with an optional self-dispatchable component, (with the latter being at a lower cost than the prevailing Eskom Megaflex Tariff).
The maximum procured capacities envisaged (depending on the level of response and pricing), are 300 MW of dispatchable/ reserve power capacity and 200 MW of self-dispatchable power capacity. The envisaged contract period is three years, and is subject to successful conclusion of a mandatory Section 33 process. The closing date for tender submissions is 8 April 2024.
‘The most important current energy priority is ending load-shedding in Cape Town, with short-term plans to protect against the first four stages of Eskom load-shedding by 2026, adding 650MW of independent power to our mix within five years, and building up to the ultimate goal of access to additional independent power to put an end to Eskom load-shedding,’ said the City’s Mayoral Committee Member for Energy, Councillor Beverley van Reenen.
The City’s short-term load-shedding mitigation plans (up to 2026) will be achieved largely through a mix of Steenbras Hydro Plant (1 – 2 stages); 500MW of dispatchable energy (up to four stages from 06:00 – 22:00 daily where possible); and demand management programmes.
Demand management programmes include Large Power Users (LPUs) curtailment, and Power Heroes, a voluntary programme for households and small commercial customers that enables remote switching of power-hungry appliances such as geysers and pool pumps.
Power supply diversification initiatives include: 
  • UNDER WAY: Embedded IPP renewable energy (200MW) – with the goal to diversify electricity suppliers for more cost-effective electricity
  • UNDER WAY: Dispatchable IPP Program (up to 500MW) – a key load-shedding mitigation mechanism, with 10-year power contracts for dispatchable power plants
  • UNDER WAY: Wheeling (up to 350MW) – a City-enabled means of third parties selling electricity to each other using existing grid infrastructure
  • DONE: Private Small-Scale Embedded Generation (up to 100 MW) mechanism – Residential and commercial customers are enabled to generate electricity for their own use and be credited for excess generation
  • UNDER WAY: City-owned SSEG (up to 20MW) from the Atlantis plant (7MW) and solar PV at City facilities (13MW)

To register to obtain the tender documents, visit: www.capetown.gov.za/tenders 

Contract number: 131S/2023/24
Good luck!
Author: Bryan Groenendaal

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