The governing documents that address the Southern African Power Pool’s (SAPP) role in cross-border transactions provide a framework that bidders, under the coal baseload independent power producer procurement programme (CBIPPP), that addresses some of the Department of Energy’s (DoE) requirements for cross-border projects in Southern Africa under the CBIPPP.
There are two key requirements that bidders of cross-border projects under the CBIPPP will need to satisfy, before the signing of the implementation agreement. These are putting in place a memorandum of understanding or arrangement between the government of the Republic of South Africa and the relevant foreign government or international organisation to enable such cross-border project to participate in the CBIPPP; secondly between the buyer (i.e. Eskom) and the relevant system operator in the country in which the cross-border project will be situated.
The primary aim of the SAPP is to provide a reliable and economical electricity supply to the consumers of each of the SAPP members which is consistent with the reasonable utilisation of natural resources and the effect on the environment and to provide a framework that bidders can use to address DoE’s requirements under the CBIPPP.
These aims are given voice in the four SAPP governing documents which are:
- the Inter-Governmental Memorandum of Understanding;
- the Inter-Utility Memorandum of Understanding;
- the agreement between operating members; and
- the operating guidelines, as amended and approved on 13 February 2014.
Bidders, who intend bidding for projects that are located in the Southern African Development Community region should, as a starting point, rely on and look to the SAPP governing documents as a framework to satisfy to address the DoE’s requirements under the CBIPPP.