South Africa’s first bid window under the Gas Independent Power Producer Procurement Programme (GASIPPPP) has concluded without any preferred bidders or capacity awards, following the failure of all four submitted proposals to meet the mandatory procurement requirements.
The Department of Electricity and Energy announced the outcome on 28 October 2026, marking a setback for the planned expansion of gas-fired electricity generation in the country.
Four bids totalling 2,830 MW were submitted before the closing date of 29 May 2026. However, inadequate assurances around gas supply were among the main reasons the proposals failed to satisfy the mandatory functional criteria.
Four Projects Submitted for Evaluation
The four proposals received under Bid Window 1 included:
- Khanyazwe Flexpower: 440 MW, Mpumalanga.
- Pictor GTP Consortium: 990 MW, KwaZulu-Natal.
- Kelvin Redevelopment: 600 MW, Gauteng.
- Komatipoort Power: 800 MW, Mpumalanga.
Despite the combined proposed capacity exceeding the programme’s 2,000 MW target, none of the projects received a capacity award.
Programme Designed to Expand Gas-Fired Generation
The GASIPPPP was developed to procure 2,000 MW of new electricity generation capacity from land-based gas-fired power facilities. The programme forms part of South Africa’s broader energy planning following the Integrated Resource Plan 2019, which identified the need for approximately 3,000 MW of new gas-generated capacity.
The remaining 1,000 MW was reserved for a separate procurement process involving facilities in Zone 13, within the Coega Special Economic Zone near the Port of Ngqura in the Eastern Cape.
Under Bid Window 1, projects were required to be new greenfield developments, excluding the conversion of the existing diesel-fuelled Avon and Dedisa open-cycle gas turbines to gas.
Proposed facilities were required to have generating capacities between 300 MW and 1,000 MW. They would also be expected to operate within agreed load commitments, with Eskom responsible for dispatching electricity according to monthly requirements.
Successful independent power producers would sell electricity to Eskom through power purchase agreements of up to 20 years, receiving compensation for capacity, energy output and ancillary services.
Gas Supply Remains a Key Challenge
The lack of adequate gas-supply assurances emerged as a major obstacle during the evaluation process.
Reliable fuel availability and supporting infrastructure are essential to the development and long-term operation of gas-fired power plants. Without credible supply arrangements, proposed facilities may struggle to demonstrate their ability to deliver dependable electricity over the duration of their power purchase agreements.
The procurement outcome has therefore highlighted the importance of addressing fuel availability and enabling infrastructure alongside generation capacity.
Department Considers Follow-Up Procurement
The Department of Electricity and Energy is considering improvements for a possible subsequent procurement round, referred to as BW1.5.
Potential changes include stronger requirements around fuel supply arrangements and the development of enabling infrastructure. Further engagement with industry stakeholders is also planned.
However, any follow-up procurement process, its requirements and implementation timetable remain subject to the necessary statutory, governance and procurement approvals.
The department indicated that it intends to provide further information before the end of 2026.
Implications for South Africa’s Energy Infrastructure
The outcome of GASIPPPP Bid Window 1 highlights the challenges of bringing new gas-fired generation capacity into South Africa’s electricity system.
While gas-to-power projects could contribute to electricity generation flexibility and diversify the country’s energy mix, their development depends on reliable fuel supply, supporting infrastructure and bankable project structures.
