South African emergency power tender challenged in court

PUBLISHED: Fri, 30 Apr 2021 12:48:35 GMT

JOHANNESBURG, April 30 (Reuters) – A South African government tender for 2,000 megawatts (MW) of emergency power has been challenged in court by one of the companies that lost out, potentially delaying capacity being added to the grid and prolonging an electricity crisis.

DNG Power wants the High Court to review its disqualification from the tender and prevent the government from signing and implementing agreements with the preferred bidders, court papers seen by Reuters show.

The government named the eight preferred bidders last month. Turkey’s Karpowership was a major winner, with three of its floating gas power stations among the eight projects chosen to help to end recurring power outages that have cost the economy billions of dollars in lost output.

In an affidavit, DNG Power’s Aldworth Mbalati alleged the tender’s outcome was influenced by corruption and that some of the preferred bidders had been unlawfully granted exemptions.

Mineral Resources and Energy Minister Gwede Mantashe’s spokesman told Reuters the tender was handled by the Department of Mineral Resources and Energy (DMRE), not the minister, and referred all questions to the department. A DMRE spokeswoman asked for questions by email but did not immediately respond.

Karpowership did not respond to a Reuters request for comment.

South Africa’s biggest opposition party the Democratic Alliance has also alleged the emergency power tender was geared towards selecting Karpowership from the start.

Backed by environmental activists opposed to Karpowership’s projects for reasons that include possible marine pollution, they say, the Democratic Alliance has demanded a parliamentary investigation, but so far without success.

The government said in March the eight projects selected as preferred bidders would inject 45 billion rand ($3.1 billion) of investment into the economy and that the first power would flow from August 2022. The projects are due to supply power over 20 years. ($1 = 14.4139 rand) (Reporting by Alexander Winning and Wendell Roelf; editing by Barbara Lewis)

(c) Copyright Thomson Reuters 2021. Click For Restrictions –

Sign Up for Our Newsletter Daily Update

Get the best of CNBC Africa sent straight to your inbox with breaking business news, insights and updates from experts across the continent.
Get this delivered to your inbox, and more info about about our products and services. By signing up for newsletters, you are agreeing to our Terms of Use and Privacy Policy.