DoE confirms new renewables bid schedule after window-one delays

Following delays to achieving financial close on the first 28 wind and solar projects, which advanced to the preferred-bidder stage in December last year under South Africa’s Renewable Energy Independent Power Producer Programme (REIPPP), the Department of Energy (DoE) has confirmed a postponement to the third bid submission date.

It has also revised the financial-close schedule of the 19 second-round preferred bidders to between March 18 and 28, 2013, from an initial date of December 2012.

In a note to bidders, the DoE outlined a new third-window submission date of May 7, 2013, having previously indicated that it intended sticking with the October 1, 2012, deadline – this, notwithstanding the fact that the window-one projects had not closed in June as initially scheduled.

The DoE indicated that the postponements followed representations from bidders, which were currently focused on the window-one and -two financial-close processes.

The department had been unable to move to financial close on the window-one projects in June, owing primarily to internal authorisation processes within government, including the firming up of government guarantees for Eskom, which would be the buyer of the power over a 20-year horizon.

It gave no indication as to when these projects would close, some bidders having indicated that the process could be concluded by the end of September.

In a statement, the DoE stressed that it had finalised all the necessary approvals required to enter into the implementation agreements with the preferred bidders.

“The government-support framework has been concluded, giving assurance to Eskom that government will support Eskom in relation to the financial implication resulting from signing of the power purchase agreement,” the department said.

It also acknowledged that the approvals processes had taken longer than anticipated and apologised to those inconvenienced by the decision to delay the process.

“Given the limited resources, it is imperative for the department to give more attention to financial close for windows one and two,” the DoE said, adding that it remained committed to closing window-one projects despite the delays.

Besides focus on financial closure for the first 47 projects, the DoE would also use the extension to update the request for proposals, and finalise the new determination for additional capacity.