The Saldanha Bay Municipality on the west coast will launch a tender at the end of October to procure 100MW of baseload power from independent power producers (IPPs).
The power, which needs to come online within three years from when the tender is awarded, will be more than sufficient to provide for the municipality’s total electricity needs.
However, mayor André Truter said the tender is written in such a way that whoever it is awarded to could scale up beyond 100MW, which will allow the municipality to feed power back into the grid. “Our vision is not only about energy security in Saldanha but in the province and the country,” he said.
The Saldanha municipal area now uses about 65MW of electricity at peak. Any excess electricity generated through this tender will be able to attract new businesses to the area and to feed electricity back into the grid.
IPPs will have five months to respond to the tender.
“The tender is very clear that the project can only be made up of gas and renewable energy sources,” Truter said.
Saldanha Bay will become an important player in the green hydrogen sector, which is one of the reasons gas-to-power was included as a possible fuel source in the tender, he said. “Gas-fired plants can easily be converted to run on green hydrogen once it becomes available.”
Truter said Saldanha took a “massive blow” with the closure of Saldanha Steel by ArcelorMittal in 2019, a move that cost the area 1,000 direct jobs and 14,000 indirect jobs.
We understand the value of having a municipality that is energy resilient and can guarantee affordable, uninterrupted energy to new factories that want to open here.
— André Truter
“One of the main reasons for the closure was the high cost of energy. From an operations point of view, a plant like this cannot deal with load-shedding. We have also seen the effect of load-shedding on our fisheries industry, with factories having to spend hundreds of thousands of rand to keep their cold rooms running during load-shedding.
“We understand the value of having a municipality that is energy resilient and can guarantee affordable, uninterrupted energy to new factories that want to open here,” Truter said.
This will include the establishment of new maritime, energy, logistics and engineering industries within the Saldanha Bay industrial development zone (Freeport Saldanha), which is located at the port of Saldanha Bay.
Sasol has already signed a memorandum of understanding with Freeport Saldanha to develop a green hydrogen hub and ecosystem.
The province has a target to add 5,700MW of renewable power from IPPs, said Western Cape premier Alan Winde.
“At the moment the province uses about 4,000MW of electricity at peak times, so the target of 5,700MW will make the province resilient going into the future. This will help create an environment that will attract investment and end load-shedding across the province,” Winde said.
In April the City of Cape Town issued its largest energy tender to date to procure 500MW with a focus on dispatchable technologies, including gas-to-power and battery storage.
City of Cape Town mayor Geordin Hill-Lewis said at the time that the city wants to be able to offer protection from the first four stages of load-shedding within three years.
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