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Market appetite for baseload, cogen projects tested

5th July 2013

By: Terence Creamer

Creamer Media Editor

  

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South Africa’s Depart- ment of Energy (DoE) has made a fresh call for potential developers of baseload and cogeneration electricity facilities to register their projects by July 12 to aid it in the design of procurement processes based on Ministerial determinations published on December 19.

The invitation was made in a recently released request for registration and informa- tion (RFRI) and follows a similar market appraisal in 2012, when potential independent power producers (IPPs) registered projects with a combined capacity of 60 300 MW and claimed that these could be intro- duced before March 2019.

The new RFRI is deemed necessary to ensure that the DoE has access to the most up-to-date information ahead of finalising the design of future procurement programmes.

The RFRI is seeking responses relating speci- fically to the Medium-Term Risk Mitigation (MTRM) determination and the baseload determination issued by Energy Minister Dipuo Peters last year. A separate process for the procurement of renewable energy is already under way through the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP)

Under the MTRM deter- mination, the DoE is seeking to procure 800 MW of near-term cogeneration capacity, which could arise from biomass, industrial waste and combined heat and power sources. It is also aiming to secure 474 MW from natural gas projects.

Through the baseload determination, 2 500 MW has been allocated to coal-fired IPP projects, 2 652 MW to baseload or midmerit natural gas capacity and 2 609 MW to domestic and imported hydroelectric prospects.

As with the REIPPPP, the DoE will be the procurer, while State-owned power utility Eskom will be the buyer and will sign the power purchase agreements.

Cross-border projects will be considered under both the MTRM and the Baseload procurement processes. But developers of such projects will need to indicate trans- mission-connection timeframes and costs.

The DoE indicated that it is open to receiving responses from developers of new generation capacity projects for which comprehensive and positive feasibility studies have been completed.

Edited by Martin Zhuwakinyu
Creamer Media Magazine Managing Editor

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