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Next renewables bid window ‘will not be location agnostic’

Electricity Minister Kgosientsho Ramokgopa

Electricity Minister Kgosientsho Ramokgopa

19th November 2023

By: Terence Creamer

Creamer Media Editor

     

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Electricity Minister Kgosientsho Ramokgopa reports that the country’s next renewables bidding round will “not be location agnostic” and will seek to direct projects to areas where there is sufficient grid connection capacity available.

“This time we're going to be specific around where these location should be for the new projects because we want to ensure that there's some degree of alignment between the projects and the availability of transmission capacity,” the Minister said during his latest update on the implementation of the Energy Action Plan.

Hitherto, the Renewable Energy Independent Power Producer Procurement Programme, which has been under way since 2011, has not had a specific geospatial dimension, with connections guided by Eskom’s Generation Connection Capacity Assessment (GCCA).

During the most recent bid window, or Bid Window Six, none of the 23 wind projects that bid for a 3.2 GW allocation were selected as preferred bidders, however. This, after Eskom claimed that the grid capacity in the areas where the projects were proposed had been fully absorbed.

Bid Window Seven (BW7) was initially planned for launch in mid-year, but the deadline was missed, with the Independent Power Producer Office having indicated that the programme could be initiated only once there was clarity from Eskom on what connection capacity remained available.

At the end of October, Eskom published an updated GCCA showing that there was no longer any connection capacity in the Eastern Cape, the Northern Cape, the Western Cape and the Hydra Central grid area. However, the document indicated that there was 19.9 GW of grid capacity elsewhere in the country.

Eskom has also since acknowledged that some 4 GW of grid capacity in the Eastern and Western Cape provinces could be unlocked immediately by allowing for 10% curtailment and has promised to publish an addendum to the GCCA outlining its approach in this regard.

Curtailment involves the active reduction of output from wind and solar plants in response to system security needs or temporary transmission capacity constraints and is widely used by system operators globally to optimise the way the grid is utilised.

Ramokgopa, who previously indicated that BW7 would be launched in December, offered no confirmation regarding timeframes, saying only that efforts were being made to ensure that the next round did not suffer the same fate as the previous bidding round by matching “projects to grid capacity”.

“This is so that we're able to accelerate the progression of those projects and they're able to reach financial close as speedily as possible.”

JET-IP IMPLEMENTATION PLAN & IRP UPDATE

He also reported that the Just Energy Transition Investment Plan (JET-IP) implementation plan had been approved by Cabinet and would include the release of financial resources for the development of transmission infrastructure that could assist with the decarbonisation of the country’s electricity industry.

Several developed countries have pledged some $11.9-billion to support the JET-IP, with various policy loans having already been extended under the framework.

Forestry, Fisheries and the Environment Minister Barbara Creecy, who will lead South Africa’s delegation to COP28 in Dubai later this month, would release details of the implementation plan, Ramokgopa said.

He also reported that a larger transmission funding plan would be presented to Cabinet at its next meeting, which could help unlock private finance and skills for the development of new grid infrastructure.

Meanwhile, the updated Integrated Resource Plan (IPR) was also likely to be presented to Cabinet by Mineral Resources and Energy Minister Gwede Mantashe at its next meeting, after which it would be released for public comment.

“At an administrative level and a technical level, those conversations have happened, and now [the IRP] gets to be elevated to the level of Cabinet and I'm sure that, post-Cabinet, we'll be able to share with you what are the elements of the IRP and of course, the rest of the country will also get an opportunity to engage with that and provide their feedback.”

Edited by Creamer Media Reporter

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