South Africa’s R440-billion transmission grid expansion programme has attracted interest from international developers, including a company owned by Indian billionaire Gautam Adani and Chinese firms.
The continent’s most industrialised nation started up the Independent Transmission Projects program in December to bring in private partners to help install 14 000 km new power lines. The government aims to add 34 gigawatts of generating capacity from wind and 25 gigawatts from solar over the next 14 years, and will require more connections to an already constrained system.
Seventeen companies and consortia responded to a request for pre-qualification by South Africa’s Independent Power Producer Office. They include Adani Power’s Middle East unit, China Southern Power Grid International, State Grid International Development Co. and France’s EDF Power Solutions. Local companies SOLA Group and Mulilo Renewable Energy Ltd. also expressed interest.
The ITP is in a “pre-qualification evaluation phase” that is expected to be concluded by November, the Independent Power Producer Office said in a response to questions.
Upgrading the national grid will underpin the government’s energy strategy. South Africa is gradually retiring coal-fired plants it currently depends on to generate the bulk of its power, and intends utilising a range of technologies from gas to renewables to meet future demand, the government’s latest blueprint shows.
EDF confirmed its interest in the ITP and is awaiting the request-for-proposal stage of the programme “which will outline the detailed technical, financial, and commercial parameters for the next phase,” the company said in a reply to questions.
SOLA Group and Mulilo also said they had submitted bids to participate. An Adani representative didn’t offer any immediate comments, while the Chinese firms didn’t immediately reply to emailed questions.
Successful ITPs based on “private party undertaking construction and financing risk with variations regarding ownership” have attracted investment in transmission lines in India, Brazil, Peru and Chile, the Development Bank of Southern Africa said in a presentation.
The first phase of the grid expansion will entail a request for proposals to build 1 164 km of transmission lines designed to bring more than 3 000 megawatts of generation capacity on line, Electricity Minister Kgosientsho Ramokgopa said in April. That project is seen as unlikely to encounter disruptions, such as disputes over land ownership.
A subsequent build of more than ten times the size of the pilot will also require the procurement and installation of transformers and other equipment.
The government plans to make credit guarantees available by July 2026 that will be mainly funded by commercial lenders to support investment in infrastructure by private companies.
A R10-billion facility that will serve as a form of private insurance will initially be used for energy transmission projects, and then be expanded to support investments in water and other infrastructure, Deputy Finance Minister David Masondo said in August.
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