DEPARTMENT OF ENERGY:

THE SOLAR PARKS PROJECT

In the determination, the Minister intends to direct the Department of Energy to design and
implement a procurement process for the appointment of one or more strategic partners (the
Strategic Partner(s)) for development, financing, construction, operation and maintenance
of one or more solar parks located in the Northern Cape (collectively the Project). The
Department has provisionally identified three potential locations in the Northern Cape for the
development of the Project.

The Department wishes to promote the establishment of solar technology manufacturing at

one or more appropriate sites within the Northern Cape. The Strategic Partner(s) will be
required to facilitate the establishment of solar technology manufacturing facilities located
at one or more suitable sites in the Northern Cape, where the initial anchor customer for
such components will be the Project.

The process to identify the Strategic Partner(s) will commence with the invitation for
interested parties to respond to the expression of interest (the EOI). The opportunity to
submit a formal submission will remain open until 20 June 2016.

Any interested party that may wish to submit a response to a request for proposals are
requested to submit a response to this EOI, however, submission of an EOI response is not
compulsory.
MILESTONES
EXPRESSION OF INTEREST - 20 JUN 2016

ABOUT THE SOLAR PARKS PROJECT

The Minister has indicated in the three existing renewable energy determinations that new
generation capacity is necessary to ensure the continued uninterrupted supply of electricity.
The Minister initially determined, in the first determination, that 3 725MW, to be generated
from Renewable Energy sources, is required. Subsequently, in the second determination the
Minister determined that a further 3 200 MW, to be generated from Renewable Energy
sources, is required. In the Third Determination, the Minister determined that a further 6 300
MW, to be generated from Renewable Energy sources, is required. This is broadly in
accordance with the capacity allocated to Renewable Energy generation in IRP 2010.
The Government has developed, or is intending to develop in the future, various procurement
processes in order to procure the Renewable Energy target required by South Africa, namely
the REIPP Procurement Programme, the Small Projects IPP Procurement Programme and any
other procurement programme as determined by the Minister from time to time.

The Minister now intends to issue a further determination, the solar parks determination, for
new Renewable Energy generation capacity from Solar Technologies which is needed to
contribute towards energy security in the amount of 1 500MW which represents the capacity
allocated to Solar PV, under the heading New Build, for the years 2026 to 2028 in Table 3
of the IRP 2010-2030.

Notwithstanding the capacity allocation is for solar photovoltaic technologies, it is the

intention of the Minister in her new determination to include any solar technology, including
energy storage solutions. In addition, it is intended that the Project Sites shall be located in
the Northern Cape.

A secondary objective of the REIPP Procurement Programme, beyond contributing to energy

security, has been to enable the establishment of a Renewable Energy industry in South
Africa, including manufacturing. From recent research conducted by the IPP Office, in
conjunction with the Department of Trade and Industry and the Department of Science and
Technologys Technology Localisation Implementation Unit, it has been recognised that to-
date that greater levels of manufacturing in South Africa could have been achieved through
targeted interventions.

Accordingly, through the solar parks determination, the Department aims to use
Governments various policy instruments to enable and to facilitate the targeted
establishment of Solar Technology component manufacturing facilities located in the
Northern Cape and, in so doing, to create sustainable employment opportunities for the
people of the Northern Cape, and in particular the youth.

Through the EOI the Department intends to determine the private sector interest seeking
appointment as either the strategic partner or one of the strategic partners to partner with
one or more State-owned company/ies to implement the project. The role of the Strategic
Partner(s) will be to provide the necessary technical and financial support for the
development and implementation of the Project, and to build capacity within and transfer
skills to the State-owned company/ies. Such support may include, inter alia, assistance with
the development of the associated grid infrastructure downstream of the power generation
facilities and the identification and establishment of solar technology component
manufacturing opportunities for the supply of such components to the projects and to third
party projects.