28 Renewable Energy Bidders Approved for Electricity Delivery

South Africa approved 28 bidders for a renewable-energy tender, the first step in the country's efforts to diversify from coal. The 28 preferred bidders, with projects totaling 1,416 megawatts, have until the end of June to have financing in order, with construction to begin shortly thereafter, the Energy Department said. Of the projects selected, around 632 megawatts were for solar photovoltaic projects; 150 megawatts, for concentrated solar power; and 634 megawatts, for wind developments.

The department is holding five tenders to allocate 3,725 megawatts valued around $12 billion over the next two years. In the first round of bidding, the department received 53 bidders for a total of 2,128 megawatts in projects. It selected 28 out of the 53. It now has 2,209 megawatts that companies can bid for in the remaining tenders.

Europe's biggest wind-turbine manufacturer, Denmark-based Vestas Wind Systems A/S, is involved in two of the bidding groups selected, representing 138 megawatts, as is South African solar company Momentous Energy, which will obtain some of the products from Chinese companies.

One of China's top wind turbine producers, Sinovel Wind Co., also was selected, with one of the larger bids, a person close to the matter said.

About 90% of South Africa's electricity comes from coal-fired power plants. By 2030, the country aims to lift renewable sources to 8% of the energy mix, up from less than 1% now.

In addition to development in the private sector, state-owned power company Eskom Holdings Ltd. is also raising money to develop its own wind and solar projects. Eskom last month signed a $250 million loan agreement with the World Bank to build 200 megawatts of own solar and wind projects. The company also is in talks with the European Investment Bank to obtain €50 million, or about $70 million, for building solar farms.

The South African government on Wednesday also said it will create the South African Renewable Initiative. Working with the European Investment Bank, the government plans to raise financing internationally to be used on renewable energy projects. Germany said it intends to support the fund.

South Africa is hosting the COP17 climate talks, which are led by the United Nations. It plans to reduce carbon emissions by 34% by 2020. (WSJ, 12/7/2011)