Economic development criteria scrapped in South Africa’s Battery Energy Storage tender

  • South Africa’s Independent Power Producers Office (IPPO) falls under the Ministry of Mineral Resources and Energy headed by Mr Gwede Mantashe.
  • Yesterday, the head of IPPO, Mr Bernard Magoro and his colleagues, held a press briefing to update prospective bidders on the request for qualification and proposals for new generation capacity under the Battery Energy Storage Capacity IPP Procurement Programme.
  • His team announced it would not be compulsory for bidders to meet any of the economic development criteria.

In early March this year the Department of Mineral Resources and Energy formally invited interested parties to register prospective bids under the Battery Energy Storage Capacity Bid Window of the Independent Power Producers Procurement Programme. A total of five substations have been specified, all in the Northern Cape, for a total of 513 MW/ 2052 MWh capacity. The substations are Garona, Mookodi, Aggeneis, Ferrum, and Nieuwehoop. A single preferred bidder will be selected for each substation. Link to the orginal tender announcement document HERE

Related news: construction on South Africa’s first battery energy storage system (BESS) begins

Louis Moyse from the IPP Office said that it would not be compulsory for bidders to meet any of the economic development criteria but that these would be included in the scoring.  Magoro added that the current law does not allow them to apply economic development criteria as thresholds or pre-qualifications. “But what we will do is set a minimum target for economic development, and once bidders reach that target, we will allocate points.” said Magoro.

Magoro has been accused of making up tender rules as he goes along. Under his leadership the IPP Office has been rife with controversy over its management of procurement programmes which has attracted allegations of rigging and corruption. REIPPPP Bid Window 5 outcome revealed that one BBBEE company H1 Holdings was a partner in no less than 21 of the 25 preferred bidders. Read more

Related news: South Africa’s REIPPP Programme is in tatters while the energy crisis deepens, Mantashe must be held accountable

Link to the overview of the request for qualification and proposals for new generation capacity under the Battery Energy Storage Capacity IPP Procurement Progamme HERE

Author: Bryan Groenendaal

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