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Projects and Energy Weekly Snippets

28 August 2015

New determinations create framework for key IPP procurement programmes

New ministerial determinations creating the framework for the procurement of additional renewable-energy, gas and cogeneration capacity from independent power producers (IPPs) have been published in the Government Gazette. The determinations are in line with announcements made by Energy Minister Tina Joemat-Pettersson in April and have been published following consultations with the National Energy Regulator of South Africa (Nersa).

The renewable-energy determination provides for an additional allocation of 6300 MW for future bid windows under the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP). The new allocation, published on 18 August, effectively doubles up on the previous allocation for renewables, which stood at 6725 MW.

Engineering News, 25 August 2015

Coal, gas, nuclear all viable, say experts

Coal, gas and nuclear energy all met SA’s need for low capital and operating costs, security of fuel supply and ability to reduce global carbon emissions, experts from each sector argued on Tuesday. At a debate on the merits of different energy technologies Shell SA chairman Bonang Mohale said SA needed to diversify its energy sources to meet a gross domestic product growth target of 7% a year to absorb all its job-seekers.

"The case for gas is compelling," Mohale said. "It is abundant, emits half the carbon emissions that new coal-fired power stations do, and it is affordable."

Nuclear Africa CEO Kelvin Kemm said concerns about nuclear safety were misplaced. No one died as a result of radiation leakage at Fukushima in Japan and fewer than 60 people were killed as a direct result of the Soviet-era meltdown at Chernobyl.
Exxaro executive Mervyn Govender said despite mining coal for 140 years, SA still had about 170 years of coal in the ground. Coal was cheap to mine and coal-fired power stations were relatively easy to build.

Business Day, 26 August 2015

Government to launch central supplier database

In a bid to simplify the process of doing business with the State, government will launch its Central Supplier Database (CSD) – a catalogue of all information related to companies that supply products or services to the State.

The CSD, which would be launched by Finance Minister Nhlanhla Nene with the support of the Eastern Cape Provincial Treasury, in East London, on 1 September, would look to reduce the exchange of compliance documents in paper form, eliminate multiple registrations with different organs of State and, ultimately, reduce the cost for both business and government by enabling electronic registration and verification processes. The database would also interface with the South African Revenue Service to verify tax clearance certificates, as well as with the Companies and Intellectual Property Commission for business registration and business ownership information.

The CSD will furthermore verify supplier information with the register for tender defaulters and the database of restricted suppliers. Prospective suppliers would be able to self-register on the CSD website from 1 September.

Engineering News, 26 August 2015

East Africa sees regional power links ready in three years

Power lines connecting the east African states of Tanzania, Uganda, Rwanda, Kenya and Ethiopia are expected to be completed within the next three years, helping improve supplies and power trading, a senior Kenyan official said on Thursday. Power shortages are common across Africa and businesses often complain that poor or erratic supplies deter more investors and push up prices of local products, as many firms rely on costly generators. Linking up national grids would provide a bigger pool of resources and mean one state can tap idle supplies in another.

"The regional power interconnection project is a very critical solution," said Joseph Njoroge, principal secretary at Kenya’s Energy and Petroleum Ministry said. Kenya, which relies heavily on hydro power, geothermal and other renewables, aims to expand installed capacity to 6700 MW by 2017, from about 2500 MW currently. Tanzania aims to double generation to 3000 MW by 2016. Ethiopia aims to become a major power exporter through large new dams and other renewable energy projects. "We would expect that with such interconnections, we should take advantage of the huge renewable resources that we have in this region," Mr Njoroge said.

Other African regions have already connected their grids. Southern Africa has a series of links between SA, Zambia, Zimbabwe and Mozambique, allowing them to trade power.

Business Day, 27 August 2015

The above reflects a summary of certain news articles published during the preceding week. It is not an expression of opinion in respect of each matter, nor may it be considered as a disclosure of advice by any employee of Hogan Lovells.

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