The Ministry of Mines and Energy, through the National Project Steering Committee, in 2014 issued a bid for the construction, operation and ownership of solar PV power plants in the country.
Following a competitive bidding process an independent power producer (IPP) consortium, Alten Renewable Hardap, comprising of Alten Renewable Energy B.V. and Sashi Investments, was selected as the successful bidder.
The 35 MW solar PV plant will be financed through equity from the shareholders in the project company, as well as debt procured from local and regional lenders.
The target commercial operation date of the plant is set as December 07, 2016. The base tariff agreed for the project is at 88.8 N$c/kWh, the lowest tariff thus far achieved for a solar PV development in Namibia. The expansion of renewable energy systems and energy efficiency in the energy mix and the inclusion of independent power producers (IPPs) in the development of power generation is a priority for the Namibian government.
In 2013, an invitation to tender for the pre-qualification of IPPs and a request for information was published by NamPower on behalf of government to solicit information from prospective IPPs for the development of the three Solar PV power stations to be constructed in the Erongo, Otjozondjupa and Hardap regions.
A total of 50 responses were received, with nine meeting the stringent pre-qualification criteria.
The bid documentation, which was prepared during 2014, comprised of comprehensive instructions to bidders, technical specifications and key project agreements.
The conditions of contracting further included the provision that a minimum percentage of the total project value should be Namibian content – through ownership, sub-contracting Namibian companies and creating employment opportunities for Namibians.
In 2013, NamPower commenced with both the land procurement process as well as the procurement of environmental clearance certificates. Environmental impact assessments were conducted on the three sites identified and the clearance certificates were obtained from the Ministry of Environment and Tourism on October 10 2014.
In December 2014, eight of the nine pre-qualified bidders confirmed acceptance that the project agreements would not include an implementation agreement or any other form of government support beyond what is provided for in the Namibian legislative and regulatory environment/framework.
The bid documents were released to the eight pre-qualified bidders on May 11 and contained minimum performance guarantees on maximum and minimum export capacity, performance ratio, maximum degradation, power plant life and safety and health requirements.
The Mandatory Bid Conference was attended by seven of the eight remaining pre-qualified bidders. By the bid closing date on October 1, 30 clarifications were sought and answered, while three amendments were issued. Six of the seven participating bidders submitted bids for all three sites, resulting in the receipt of 18 bid submissions.
The responsive bid submissions were evaluated thereafter for technical compliance. All responsive bid submissions were found to be technically compliant and their financial proposals were opened and evaluated. The ranking and selection of the bid submissions and the identification of the first and second ranked bidder per site was based on the best bid submissions for each site. The first ranked bidder achieved the best overall score (technical and financial combined) and also offered the lowest base tariff on all three sites.
After the tender had closed on October 1, it became evident that land at the Omburu and Osona sites respectively was no longer available for the intended purpose due to factors outside the control of NamPower. A decision was then taken to relocate the capacities planned for the Omburu and Osona sites in the solar PV project to the Hardap site.
The terms of the overall scope of work for the power project were confirmed and accepted by the preferred bidder (first ranked bidder for all three sites), including the relocation of the Omburu and Osona sites.
The chairperson of the national Project Steering Committee (PSC) for the implementation of renewable procurement mechanisms confirmed that the bid for this national project was awarded to Alten Renewable Hardap on December 07.
Alten Renewable Hardap is co-owned by Alten Renewables B.V, a Spanish company and Sashi, a Namibian company owned by previously disadvantaged Namibians.
The Minister of Mines and Energy, Obeth Kandjoze, in his meeting with the national PSC expressed appreciation towards all the bidders who participated in the tender and noted that he was satisfied that due diligence was followed and that the evaluation process of the tenders was comprehensive, credible, professional and transparent.
“PV technology is improving rapidly and internationally the market has been growing exponentially. This trend will likely continue until 2050, resulting in greater cost-reduction and accessibility. Similarly, a number of companies specialising in solar thermal power stations exists today and in the future IPPs will play a far more significant role in Namibia’s electricity generation,” said Kandjoze.