Mulilo, Scatec preferred bidders for battery storage

These projects will be developed at five key Eskom substations: Leander, Theseus, Everest, Havard, and Merapi.

The BESIPPPP is part of South Africa’s broader effort to integrate private-sector participation in strengthening the national grid.

 Under this initiative, private companies can build large-scale battery storage systems that can store renewable energy, particularly solar power, generated during the day for use during high-demand evening and morning periods.

The programme aims to ensure energy reliability while transitioning toward a more sustainable and cost-effective power supply system.

“We are going to use that excess generation capacity that we generated during the day when the sun was out – cheap generation, store it and at a time when we need it we are going to draw it from the batteries and be able to discharge and give us the kind of capacity that we need,” said Ramokgopa.

The projects awarded under Bid Window 3 will utilise batteries with a four-hour discharge capacity, enabling them to support the grid during peak demand times. 

Ramokgopa noted that the system is designed to displace costly diesel-based generation with cheaper, stored renewable energy. 

“The 730 of these four hours that we need and this coincides with the morning and the evening peak when the system is not performing and the demand is higher when we rely on diesel is very expensive and now we are bringing cheaper solutions because we would have charged it using cheaper energy and that means that overtime once we have a bigger share of this battery storage solar PV we can be able to bring down the price of electricity.” 

According to Ramokgopa, the latest round will result in R9.5 billion worth of investments in the country, contributing significantly to job creation and infrastructure development. 

The power purchase agreements for these projects will be valid for 15 years. 

“The power purchase agreement is for a period of 15 years, and this is consistent with international best practice. It’s an open and transparent process,” added Ramokgopa.

He also emphasised that the government plans to acquire land near substations in future bid rounds to prevent bidders from being penalised for distance-related inefficiencies. 

However, he warned that preferred bidders must deliver on their obligations or face penalties. Specifically, battery systems must return the allocated energy to the grid during peak hours or risk financial consequences.

Since 2020, South Africa has sought to procure 28 GW of new power generation capacity through various procurement windows, including renewables, gas-to-power, risk mitigation, and battery storage. 

So far, over 7,000 MW have been secured from previous bid windows, marking steady progress in addressing the country’s long-standing energy supply challenges.

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