By Helmo Preuss
Electricity and Energy Minister Kgosientsho Ramokgopa at the signing of Projects Agreements and Commercial Close for two projects under the first Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP) Bid Window said yesterday that Battery Energy Storage will provide grid stability as more variable renewable energy projects are added to the national grid.
Battery Energy Storage System (BESS) technology plays a critical role in grid operation by storing energy during periods of less demand for electricity and releasing that energy when needed (for example, during peak demand periods).
In addition, BESS provides grid stability through Ancillary Services for the System Operator. BESS further allows for more integration of renewable energy onto the grid.
The difference in power output between a hot windy day and a dark wind still day, which the Germans call a “Dunkelflaute”, can exceed 4 500 Megawatts (MW).
Four Preferred Bidders were announced under this first Battery Energy Storage Bid Window on November 30, 2023, and as of yesterday these have all reached a commercial close.
A fifth project was appointed on March 28, following value-for-money negotiations. This last project is finalising preparations and final conditions to reach commercial close in early 2025.
The two projects signed on 18 November have a capacity of 180 MW/720 Megawatt-hours (MWh) developed by EDF International and their project partners, Mulilo, GibbCrede, Pele Green Energy, and a community trust.
Oasis Aggeneis, with a total capacity of 77 MW/308 MWh will be located at Aggeneis sub-station close to the town of Aggenys in the Northern Cape, while Oasis Nieuwehoop, with a capacity of 103 MW/412 MWh, will be located at Nieuwehoop sub-station close to Kenhardt.
Project construction is expected to take no more than 24 months and the storage capacity is expected to come online no later than November 2026.
The projects will attract a total investment of R4.7 billion. South African Entity Participation of around 42.2% and BEE ownership of 40% has been achieved across both projects.
The two projects will provide 487 job opportunities (measured in job years) for South Africans, which includes 301 jobs during construction and 186 jobs during operations. The projects have committed to spending 20% of total project costs on local content during construction, and 20% on local content during operations.
The projects have also committed over R43 million over their 15-year lifetime to be spent on areas such as skills development, supplier development, bursaries for black students, enterprise development and socio-economic development initiatives.
A further two Battery Energy Storage bid windows are currently underway. Bid Window 2 (totaling 615 MW) is currently in the evaluation phase with bid announcement expected within the next few weeks. Bid submission for Bid Window 3 is planned will be on November 28.
The renewable energy procurement programme has brought R292bn of investment into the economy with a 38% black shareholding, according to the Independent Power Producer (IPP) office.
It said the IPP programme, since its inception in 2011, has brought 7 361 MW onto the grid in 93 renewable energy projects and two diesel-powered peaker projects. The office says that during 2023 the IPPs alleviated at least two load-shedding stages.
In addition to 6 356 MW of renewable IPP energy already feeding the grid, another 2 077 MW are under construction, and over 8 000 MW of capacity is in the market and will be evaluated in 2024/25.
BUSINESS REPORT