ABSTRACT
In 2007 Eskom was mandated to source 5,000 MW of new generation investment from the private sector (Eskom, 2008a). In this context, it seems feasible that a tender process would be an effective way of encouraging the private sector to contribute towards meeting the CSP target. International experience (e.g. Denmark, Ireland and the UK) has indicated that a competitive tendering process results in lower costs for deploying renewable technology projects (see Neuhoff et al., 2008, for a review of international experiences in renewable support schemes). Tendering is a process whereby bidders compete to supply a defined amount of energy for a contracted period, at a pre-agreed rate (Bode and Groscurth, 2008). The South African Electricity Regulation Act of 2006 could provide legislative support for a tender process. Provisions exist for the Minister of the DME to make regulations regarding the participation of the private sector in new generation activities.
