Eskom launches cross-border standard offer programme for short-term energy purchases

  • On 18 October 2023, Eskom launched the cross-border standard offer programme (CBSOP) for short-term energy purchases from cross-border utilities and cross-border Independent Power Producers (IPPs).
  • This gives impetus to South Africa’s efforts to add more megawatts as possible to the national electricity grid and address the issue of loadshedding.

The standard offer approach enables Eskom to purchase cross-border energy at an established price calculated at the avoided cost of Eskom’s own generation (including long-term energy purchases from local IPPs). It also allows for a predictable tariff, which is adjusted each year based on the regulatory-approved cost recovery mechanism and covers the variable cost of local generation. The programme is designed to simplify the procurement of energy from existing and new facilities in the region.

The CBSOP fixed rates for the 2024 financial year (FY) are as follows:

Energy rate (R/MWh) High season Low season
Peak R3 638.90 R1 510.14
Standard R909.73 R849.08
Off-peak R606.48 R606.48

* Notes:

  • Price is a time-of-use structure that is determined annually before 28 February, applicable to the next contract year.
  • High season comprises the South African winter months of June to August, with the remaining months being defined as the low season.
  • FY2024 runs from 1 April 2023 to 31 March 2024.

Eskom hopes to contract approximately 1 000MW with this programme which will significantly reduce the current capacity constraints.

More information on the programme as well as the application form can be accessed from the Eskom website via the following link: https://www.eskom.co.za/eskom-divisions/tx/cross-border-standard-offer-programme/

Author: Bryan Groenendaal

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