Nersa agrees with renewables bidding process

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The South African National Energy Regulator (Nersa) on Wednesday confirmed that it concurred with the Department of Energy’s (DoE’s) independent power producer (IPP) procurement programme .


The DoE had announced earlier this month that it would abandon a renewable energy feed-in tariff (Refit) in favour of a selection process that would involve both price and nonprice elements, having raised concerns about its legal compatibility with government procurement rules, as well as the fact that such schemes had in other countries led to prices that could now not be sustained.


The regulator noted that the DoE’s determination needed to be aligned with the country’s Integrated Resources Plan between 2010 and 2030 and State-owned power utility Eskom’s multi-year price increases up to March 2013.


“Nersa will continue to execute its mandate in line with the New Generation Regulations, issued on May 4, 2011, and the Electricity Regulation Act,” regulator member Thembani Bukula said in a statement.


The DoE formally launched the tender process last week, inviting potential developers to submit proposals for financing, construction, operation and maintenance of renewable energy projects.


The government indicated it will seek to procure 3 725 MW, rather than the 1 025 MW indicated in the integrated resource plan for the first procurement phase.


The DoE had allocated capacity across various renewables technologies, with 1 850 MW set aside for onshore wind, 200 MW for concentrated solar thermal, a further 1 450 MW for solar photovoltaic solutions, 12.5 MW for both biomass and biogas, 25 MW for landfill gas capacity, 75 MW for small hydro, and a further 100 MW for small-scale IPP projects of less than 5 MW.


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