Midvaal procures PPP to stabilise electricity supply
The 20-year PPP electricity concession will be awarded through a two-part competitive procurement process (RFQ and RFP) under Municipal and Electricity laws.
MIDVAAL – Following challenges with the stability of electricity supply from state-owned power utility Eskom, the Midvaal Local Municipality (MLM) has undertaken the procurement of a Public-Private Partnership (PPP), which will see a private company be awarded a 20-year contract to supply electricity in the area.
This is part of the municipality’s efforts to reduce its reliance on Eskom and improve the management of its electricity network infrastructure. The 20-year PPP electricity concession will be awarded through a two-part competitive procurement process (RFQ and RFP) under Municipal and Electricity laws.
A PPP involves collaboration between a government agency and a private-sector company that can be used to finance, build, and operate projects.
The objectives of the PPP are to maintain MLM’s existing net electricity revenue, improve efficiency and effectiveness in electricity service provision, improve continuity of electricity supply through broader bulk purchases to reduce the impact of loadshedding, and pursue the best possible value-for-money proposition for customers.
Municipal manager Anton Groenewald said the PPP concession will incorporate all core electricity distribution functions, including the use, possession, finance, design, management, operation, maintenance, and expansion of the MLM electricity distribution network.
Groenewald said the private party is envisaged to be licensed by NERSA and will be responsible for day-to-day operation and maintenance, capital investment, billing and collection of electricity tariffs, and paying a concession fee to MLM.
“The Feasibility Study has been completed and positive views and recommendations have been received.”
The MLM raised awareness about the process through a PPP National Conference on November 29. Through the event, all interested parties engaged in the matter.
The municipality received over 40 registrations for the PPP Concessionaire, with more than 200 parties expressing interest in attending the conference.
The event was joined by Deputy Minister of Energy and Electricity Samantha Jane Graham-Maré, Midvaal mayor Peter Teixeira, members of Midvaal’s Mayoral Committee, and various stakeholders.
