South African Renewable Energy Independent Power Producer Programme: Bid Window 5 finally announced

The launch of the RFP for bid window 5 has been long awaited by the South African Renewable Energy market and is an exciting and much welcome development.

On 18 March 2021, Minister Gwede Mantashe announced that the Request for Proposals ("RFP") for the fifth bid window under the Renewable Energy Power Producer Programme ("REIPPP") would be released on 19 March 2021.  In addition, it was announced that the Government intends to release 4 more RFPs within the next 12 months - which will include 2600 MW from renewable energy.

8 preferred bidders were, furthermore, announced in relation to the Risk Mitigation IPP Procurement Programme - whereby the Government intends to procure 2000 MW to meet the immediate electricity supply gap.  The preferred bidders are required to reach financial close by no later than 31 July 2021.

The Independent Power Producer office (as established by the Department of Mineral Resources and Energy; the National Treasury and the Development Bank of South Africa) ("the IPP Office"), made a similar announcement confirming, amongst other things that:

• The RFP calls for proposals from Independent Power Producers to develop new generation capacity of 2 600 MW, including 1 600 MW from onshore wind energy and 1 000 MW from Solar Photovoltaic (Solar PV) power plants;
• The project sizes will range from a minimum of 1 MW to a maximum of 140 MW (for Onshore Wind) and 75 MW (for Solar PV);
• The RFP for Bid Window 5 will inter alia aim in:
  • Promoting economic transformation in order to enable meaningful participation of black people in the economy; and
  • Increasing the extent to which communities, workers. cooperatives and other collective enterprises own and manage existing and new enterprises and increasing their access to economic activities, infrastructure and skills training;
• The lack of activity in the Renewable Energy market over the last 5 years has resulted in local manufacturing capacity being significantly eroded. Bid Window 5 is viewed as an exciting opportunity to re-ignite the Renewable Energy sector; and
• The payment of a non-refundable fee of R 25 000 (twenty five thousand rand) net of all charges, entitles each prospective Bidder to have access to the RFP and to submit one project at the bid submission date.

Members of the Clyde & Co team in South Africa have been extensively involved in advising private sector entities within the renewable energy sector (comprising of equity investors, the special purpose project vehicle, lenders and contractors) in the previous rounds of the REIPPP.

Please contact Ernie van der Vyver or Hielien Venter if you have any questions or require legal advice in relation to the requirements of the RFP; the structuring of bids in response to the RFP; engaging with applicable stakeholders (such as contractors, landowners, lenders and/or equity participants), performing due diligence investigations and for any other related queries.

The closing date for bid submission is 4 August 2021.

The full statement from the IPP office can be viewed here.

The announcement from Minister Gwede Mantashe can be accessed here.