IDC to pump R5.2bn into renewable energy

"The IDC has approved R5.2bn towards the implementation of the 12 projects. These are located in various provinces of South Africa, including the Northern Cape, Western Cape, Eastern Cape and North West and are expected to boost much- needed economic activity in these areas," said head of the Green Industries Business Unit at the IDC Rentia van Tonder.

This comes after the Energy Department on Wednesday released its first list of preferred Independent Power Producers (IPPs).

South Africa wants to procure 3725MW of renewable energy through this process. According to the Integrated Resource Plan (IRP2010) - which is a 20-year projection on electricity supply and demand - about 42% of electricity generated in South Africa is required to come from renewable resources.

In August, the department put out a request for proposals on new generation, asking IPPs to submit their proposals for the first window, which closed on 4 November.

The IDC, which is a national development finance institution set up to promote economic growth and industrial development, said the 12 bidders it will finance have broad-based BEE participation by communities and will further enhance the localisation of green industries in South Africa.

Billions allocated to facilitate green economy

In total, the IDC has allocated R25bn over the next five years towards developing and financing industries that enhance South Africa's transition to a green economy.

Meanwhile, Business Unity South Africa (BUSA) has welcomed the announcement of the successful bidders, saying this is in line with BUSA's views on the need to mobilise private sector participation more fully in electricity generation.

"BUSA would in particular like to commend the government for the thoroughness of the process - and in particular the public explanation of the process by the director general - which reflected both the high level technical rigour, as well as the security employed, to ensure a transparent process.

"The criteria with which the successful bidders will have to comply are extensive and include the key elements of localisation and job creation. Vigorous implementation of the Industrial Policy Action Plan and the Green Economy Accord - in which commitments were made to localisation by the renewable energy sub-sectors - will be required to ensure the job creation benefits of the IPP program are realised," said BUSA in a statement.