The Minister of Electricity and Energy, Dr Kgosientsho Ramokgopa, recently announced the selection of eight companies to lead South Africa’s renewable energy and battery energy storage projects.
These companies were chosen through two government programs: the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) and the Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP).
Solar and wind power
According to the Department of Electricity and Energy, the first batch of eight companies was chosen as Preferred Bidders under the REIPPPP Bid Window 7, aimed at expanding South Africa’s renewable energy capacity. This bidding process, which started in December 2023, sought to bring in up to 5,000 MW of renewable energy, divided between 1,800 MW from solar power and 3,200 MW from onshore wind power.
The department said it received 48 bids by August 2024. “After a thorough evaluation process, 8 projects—focused on solar power—were selected. These solar projects will provide a total of 1,760 MW of energy, enough to power thousands of homes and businesses across the country,” Ramokgopa explained.
He said that these projects are expected to bring in an investment of R31.4 billion. They also include commitments to create 6,971 jobs for South African citizens, both during the construction and operational phases of the projects. In addition to providing clean energy, the companies have committed to supporting local businesses, with R7.8 billion allocated for local content during construction and R2.4 billion during operation.
Ramokgopa explained that a key part of the government’s strategy is to include Black Economic Empowerment (BEE) initiatives. The solar projects have pledged to invest R3 billion in Black Enterprise Procurement, R2 billion in B-BBEE Procurement for Qualifying Small Enterprises (QSEs) and Exempt Micro Enterprises (EMEs), and another R333 million specifically for Black Women. The projects will also contribute R73 million for Enterprise Development, R129 million for Socio-Economic Development, and R138 million for Skills Development initiatives.
Ensuring energy availability
The Department of Energy explained that the second set of eight companies was selected under the BESIPPPP Bid Window 2. “This program focuses on improving South Africa’s energy storage capacity. Battery storage systems help store extra electricity, which can be used when needed, especially during times of high demand or when renewable energy sources like wind and solar are not generating enough power,” the department said in a statement.
The second bidding round for energy storage attracted 31 bids, and after careful evaluation, 8 companies were chosen to build facilities that will store and provide energy to the national grid. These projects are expected to bring in R12.8 billion in investments, contributing to South Africa’s goal of ensuring a reliable and sustainable power supply.
These battery energy storage projects will create 1,570 jobs during their construction and operation phases. The companies involved have committed to allocating 31% of the total project costs to local content, equaling R2.6 billion during construction and R2.5 billion during operation.
Similar to the renewable energy projects, the battery storage companies have made strong commitments to Black Economic Empowerment. They have pledged to spend R1.8 billion on Black Enterprise Procurement, R1.4 billion on B-BBEE Procurement for Qualifying Small Enterprises (QSEs) and Exempt Micro Enterprises (EMEs), and R659 million specifically for Black Women. The projects will also invest R316 million in Supplier Development, Skills Development, Bursaries for Black Students, and Socio-Economic Development.
The future of energy in South Africa
Minister Ramokgopa congratulated the 16 companies—8 for renewable energy and 8 for energy storage—on being selected as Preferred Bidders. He made special mention of the importance of these projects for South Africa’s future, as they will play a vital role in addressing the country’s electricity challenges and reducing its reliance on non-renewable energy sources.
These projects are expected to significantly boost South Africa’s capacity to generate and store clean energy, which will contribute to a more reliable and sustainable power grid.
