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Renewable Energy IPP Procurement Programme:

Summary of Evaluation Findings

07 December 2011

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Agenda Overview of Evaluation Process.

Overall Evaluation Recommendation.

Preferred Bidder technology allocation.

Preferred Bidder Project Name and MW allocation.

Findings of Independent Review Team.

OVERVIEW OF EVALUATION PROCESS.

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Introduction• The Minister has determined, in consultation with NERSA, that New Generation Capacity is

required in accordance with the IRP2010.

• The determination provides for procurement of 3725MW across different technologies (inclusive of 100 MW Small Projects).

• Procurement documents were prepared and approved by the DG to procure power from the private sector. (safe for the 100 MW Small Projects)

• The procurement documents were released on the 03 of August and compulsory bidders conference for the first and second window, was on the 14 of September.

• 53 Bids were received by the 4th of November and evaluation was conducted in a secure environment at Gallagher Convention Centre between the 4th November and 28th November 2011.

• All evaluation rooms were under 24 hours voice and visual recordings, all the records are with DoE security for future reference.

• DoE supply chain was represented throughout the evaluation.

Procurement documents

•Part A: General Requirements and Rules

•Part B: Qualification Criteria

•Part C: Economic Development

Request for Proposals•Wind

PPA•Solar

PPA•CSP PPA

Power Purchase Agreement

•Contract between the IPP and the Department

•Obligation for IPP to deliver as per their commitment

•In buyer default – Department to pay the IPP

Implementation Agreement

Procurement Process Background

To be concluded in Phase 1

Request for Proposal (RFP)

• Requirements• Rules

RFP Part A

• Environment• Land• Economic Develop• Finance• Technical• Price• Capacity

RFP Part BQualification

• Price • Job creation • Local content • Ownership • Management Control • Preferential Procurement • Enterprise Development• Socio-economic

development

RFP Part CComparative Evaluation

Procurement Process Background

General Evaluation Observations

• Comprehensive evaluation template developed in accordance with the RFP prior to accessing the evaluation venue.

• Comprehensive training of all evaluators in all different disciplines the use of the template.

• Moderation of all evaluators work by independent evaluators.

• Cross moderation in respect of finance.

Evaluation team:

• International reviewers• Legal review – Linklaters (UK)• Technical review – Tony Wheeler Consulting (UK)• Financial review – cross-moderation between the

two Financial Advisor firms• Governance review – Ernst & Young

• Legal evaluation team• Bowman Gilfillan, • Edward Nathan Sonnebergs, • Ledwaba Mazwai• Webber Wentzel

• Technical evaluation team• Matt Macdonald

• Financial evaluation team• Ernst & Young• PWC

Evaluation Streams:

• Environment• Land right• Application for land use• Municipal land – rights• Own Build – right over land

• Land• Notarial lease registration• Proof of land use application

• Commercial legal• Acceptance of the PPA• Project structure

• Economic Development• Contributor status level• Compliance with threshold

• Financial• Full and partial price indexation

• Technical• Eligibility• Energy resource

Evaluation Composition

OVERALL RECOMMENDATIONS(PHASE 1)

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Recommended Preferred Bidders(Technology allocations)

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Allocation to Preferred Bidders: Window 1

Allocation per Determination Still Available MW allocation

per Determination

MW Percentage MW PercentageSolar PV 631.53 43.6% 818.47 56.4% 1450.00Solar CSP 150.00 75.0% 50.00 25.0% 200.00Wind 633.99 34.3% 1216.01 65.7% 1850.00Biomass 0.00 0.0% 12.50 100.0% 12.50Biogas 0.00 0.0% 12.50 100.0% 12.50Landfill gas 0.00 0.0% 25.00 100.0% 25.00Small Hydro 0.00 0.0% 75.00 100.0% 75.00Total MW 1415.52 39.0% 2209.48 61.0% 3625.00 Total Capacity - Bids Received 2127.66 Percentage Preferred Bidders 66.5%

Number of Passing Bids 28

Recommended Preferred Bidders – Solar PV

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Project_Name Capacity (MW)

1 SlimSun Swartland Solar Park 5.002 RustMo1 Solar Farm 6.763 Mulilo Renewable Energy Solar PV De Aar 9.654 Konkoonsies Solar 9.655 Aries Solar 9.656 Greefspan PV Power Plant 10.007 Herbert PV Power Plant 19.908 Mulilo Renewable Energy Solar PV Prieska 19.939 Soutpan Solar Park 28.0010 Witkop Solar Park 30.0011 Touwsrivier Project 36.0012 De Aar Solar PV 48.2513 SA Mainstream Renewable Power Droogfontein 48.2514 Letsatsi Power Company 64.0015 Lesedi Power Company 64.0016 Kalkbult 72.5017 Kathu Solar Energy Facility 75.0018 Solar Capital De Aar (Pty) Ltd 75.00

No. of Preferred Bidders for Solar Photovoltaic: 18 631.53

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Project_Name Capacity (MW)

1 Dassiesklip Wind Energy Facility 26.192 MetroWind Van Stadens Wind Farm 26.193 Hopefield Wind Farm 65.404 Noblesfontein 72.755 Red Cap Kouga Wind Farm - Oyster Bay 77.606 Dorper Wind Farm 97.007 Jeffreys Bay 133.868 Cookhouse Wind Farm 135.00No. of Preferred Bidders for Wind: 8 633.99

Recommended Preferred Bidders – Wind

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Project_Name Capacity (MW)

1 Khi Solar One 50.002 KaXu Solar One 100.00No. of Preferred Bidders for Solar CSP: 2 150.00

Recommended Preferred Bidders – Solar CSP

Findings of independent review teams

• Independent legal review“appropriate process was undertaken to ensure a consistent approach”

• Independent technical review“TWC is also satisfied that the technical evaluation has been undertaken in accordance with the agreed methodology”

• Financial cross-moderationThe final results from the financial team reflects the cross-moderation between financial firms.

• Governance review“we did not observe evidence of breaches in governance with impact on the validity of the overall process recommendations”

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Thank You