Ramokgopa trumpets Black Economic Empowerment in BESIPPPP Bid Window 3 outcome

• Electricity and Energy Minister, Dr Kgosientsho Ramokgopa, has announced the appointment of two  preferred bidders under the Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP) Bid Window 3.
• These preferred bidders are expected to make a total investment of R9.5 billion into the South African economy.

BESIPPPP Bid Window 3 is a site-specific procurement round designed to facilitate the procurement of up to 616 megawatts (MW) from facilities that will provide capacity, energy and ancillary services to the National Transmission Company of South Africa (NTCSA) as the buyer, at five specified sites in the Free State supply area.

Mulilo Energy, which is majority owned by th Danish investment firm Copenhagen Infrastructure Partners, has been named as Preferred Bidder for 4 of the 5 projects in Round 3 of South Africa’s Battery Energy Storage Independent Power Producers Procurement Programme (BESIPPPP). This represents a total of 493MW / 1,972MWh of battery energy storage capacity. The fifth BESIPPPP project was awarded to Scatec.

The 4 Mulilo projects are all located in the Free State, South Africa and include:

• Erfdeel BESS – 123 MW / 492 MWh
• Retreat BESS – 123 MW / 492 MWh
• Bloemhoek BESS – 124 MW / 496 MWh
• Vanilla BESS – 123MW / 492MWh

Norwegian independent power producer, Scatec ASA,  has been awarded preferred bidder status for the Haru BESS Battery Energy Storage Project also located in the Free State province totalling 123 MW/492 MWh.

The department received a total of 33 bid responses on 28 November 2024.

The BESIPPPP BW3 round was again found to be highly competitive, with a marked increase in the number of bids relative to the previous bid windows, resulting in a 40% and 8% decrease in the average evaluation Price, compared to Bid Window 1 and 2 prices respectively.

The five preferred bidders (projects)  have made the following commitments:

• Black Shareholding: will contract at a minimum of 40% in the IPP Project Companies; up to 30% black shareholding by construction contractors; and up to 42% in operations contractors.
• Total Job Opportunities: 852 job opportunities for South African citizens (measured in job years), during construction and operations.
• Local Content Spend: Over R3.7 billion during construction and during the operation and maintenance phases.
• Preferential Procurement: Over R3 billion from Broad-Based Black Economic Empowerment (B-BBEE) companies, R1.3 billion from black-owned enterprises, R1.1 billion from Qualifying Small Enterprises (QSEs) and Exempted Micro Enterprises (EMEs) as well as R562 million from black women companies.
• Supplier development, skills development, bursaries for black students, skills development for Black disabled people, enterprise development and socio-economic development initiatives: R184 million over the lifetime of the projects.

Author: Bryan Groenendaal