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UPDATE 1-S.Africa picks preferred bidders for emergency power tender, minister says

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CAPE TOWN, March 18 (Reuters) - South Africa’s government has selected eight preferred bidders, including Turkey’s Karpowership, to provide emergency electricity and help prop up the country’s ailing power supply, Energy Minister Gwede Mantashe said on Thursday.

The tender for 2,000 megawatts (MW), launched two years ago when South Africa suffered some of the worst power cuts in a decade, aimed to find the cheapest and quickest options to ease a shortage that has cost the continent’s most industrialised economy billions of dollars.

“The evaluation process has resulted in the selection of eight preferred bids totalling 1,845 MW and a further three eligible bids totalling 150 MW,” Mantashe told a media briefing.

Besides Karpowership, which operates a fleet of powerships and will provide ship-to-shore electricity when eventually anchored at three coastal sites, Saudi Arabia’s ACWA Power and other firms Oya Energy and Umoyilanga Energy were also shortlisted.

In February last year, Karpowership told Reuters that each of its ships, which anchor off-shore and connect to the electricity grid, is capable of providing a range of power options from 30MW to around 600MW and contracted for different lengths of time. Karpowership did not immediately respond to a request for comment.

Mantashe said the projects were expected to inject around 45 billion rand ($3.05 billion) into South Africa’s economy, with the first power expected to be connected to the grid from August next year.

Mantashe said a request for proposals for the procurement of 2,600 MW under the latest bid round for private power producers will go to the market at midnight on Thursday.

“We intend to release four more requests for proposals within the next 12 months,” he said, adding that this will include 3,000 MW from gas, 1,500 MW from coal and 513 MW from battery storage.

Drowning in a pile of debt, state-owned power utility Eskom cannot meet demand and regularly cuts power to industries and households, known locally as load-shedding, to help stave off a complete power grid collapse.

Design flaws at underperforming new power stations and unreliable coal-fired plants that provide more than 80% of the country’s electricity needs has hit power generation capacity.

On Monday, senior Eskom executives said the utility faced uncertainty on about 6,000 MW at any given time, out of a total nominal capacity of over 44,000 MW, and that electricity supplies would remain erratic until a maintenance plan was completed by September. ($1 = 14.7567 rand) (Reporting by Wendell Roelf; Editing by Edmund Blair and Susan Fenton)

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