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Emergency power selection: Powerships over renewables and storage

This is the last in a series of three interviews that explore the rationale, outcomes and some of the details of the recently announced emergency power tender, the Risk Mitigation Independent Power Producer Procurement (RMIPPP) programme.

In this interview, we explore some of the issues relating to the selection of gas-to-power over wind, solar PV and battery energy storage for some two-thirds of the generation capacity awarded. Chris Yelland speaks with Department of Mineral Resources and Energy Deputy Director-General, Jacob Mbele, and IPP Office Acting Chief Operating Officer, Maduna Ngobeni.

Why are preferred bidders using solar PV technologies required to buy locally made solar PV panels, which may not available from local manufacturers in the quantities required by the market, and may come at a substantial price premium, while for the Karpowership projects, the powerships, gas engines, floating fuel storage and regasification units (FSRUs) and the liquified natural gas (LNG) fuel (which in itself accounts for about 60% to 70% of the total cost) is allowed to be fully imported? 

Maduna Ngobeni: Remember that there are designated components, and there are components that are not designated. The DTIC looks at what is available from the local market and what South Africa is capable of manufacturing locally, and then designates certain products and components for local manufacture. Both solar PV panels and ships are designated for local manufacture.

However, the powerships and FSRUs have subsequently been granted exemption from such designation for local manufacture by the DTIC, who have since concluded that these powerships cannot be manufactured here. However, when it comes to solar PV panels, the DTIC has looked at the South African industry and decided that it is possible to manufacture these locally.

Now, you are suggesting that the local solar PV panel manufacturing industry may not have sufficient capacity to deliver the required volumes. However, based on the bids received, we do not believe this to be the case. Everybody that submitted a bid confirmed that they would be able to source solar PV panels locally, and remember, not everyone that submitted a bid, was selected as a preferred bidder.

Click on the link below for full report

Source: EsiAfrica

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