State-owned utility Eskom has confirmed to Engineering News on June 23 that 18 companies have been selected from the bids received for the lease of Eskom-owned land in Mpumalanga, which has been earmarked for independently developed renewable energy generation projects.
At this stage, no contracts have been signed because the companies that have been selected must first obtain environmental-impact assessment approval.
Eskom CEO André de Ruyter said the aim was to officially sign the land lease agreements with the successful bidders by August, at which time the winning bidders’ names would be revealed.
He attributed the relatively quick turnaround in this process to reduced red tape and the impact of the liberalisation of the energy sector.
The current bids cover about 4 000 ha out of a total of 36 000 ha that has been made available as part of the programme. The selected projects are expected to provide a total of about 1 800 MW of generation capacity once they are brought online and connected to the grid, with each project contributing 100 MW through either solar or wind energy generation.
This additional capacity will be added to the grid at no extra cost to taxpayers, De Ruyter confirmed.
The land lease agreements will be concluded on a commercial basis, with Eskom earning income from the lease of the land.
Meanwhile, the projects will enter into sale agreements for the electricity with third parties, with Eskom having no influence on who that electricity is sold to.
According to a Business Day article on June 23, Eskom expected the winning bidders to enter into contracts to sell their electricity to large-scale power consumers, which would alleviate the pressure on Eskom’s generation capacity considerably.
Eskom has not confirmed when the remaining 32 000 ha will be made available for further bidding rounds.