South Africa Seeks Renewable Energy Procurement Proposals

South Africa has issued the first request inviting proposals for renewable energy procurement for 3,740 megawatts (MW) in the biggest such program in Africa. 

“The release of this Phase One RFP comes at an opportune moment, with government remaining steadfast in eradicating the electricity and water supply challenges, and the rampant landfill shortages our country continues to face,” South Africa’s Public Works Minister Sihle Zikalala said in a statement carried by Bloomberg. 

Currently, coal is the major energy source for South Africa, accounting for around 80 percent of the country’s energy mix. The country is also the world’s fifth-largest coal exporter. 

But South Africa is going through a significant energy crisis with daily rolling power cuts that are crippling the economy as state firm Eskom continually fails to boost generation capacity to keep pace with growing demand in recent years.  

Early this year, U.S. Secretary of the Treasury Janet Yellen said that the United States supports South Africa’s transition to cleaner energy and will help mobilize financing from the private sector to assist the coal-dependent country. 

The U.S., the UK, France, Germany, and the EU are mobilizing an initial $8.5 billion to catalyze the first phase of South Africa’s Just Energy Transition (JET) Investment Plan as part of a long-term Just Energy Transition Partnership (JETP) signed in 2021.

“The financial package of $8.5 billion is a substantial down payment. Importantly, it is designed to mobilize additional money from the private sector and philanthropies, and I will meet with representatives from both groups later today,” Secretary Yellen said in January this year. 

Under the just transition plan, South Africa will invest in job retraining and reskilling, cash payments to support displaced workers while they find new employment, and redevelopment of former coal mines and coal power plants as clean energy production sites and other productive uses. 

By Tsvetana Paraskova for Oilprice.com

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