By Thapelo Molefe
No preferred bidders have been appointed under South Africa’s first Gas Independent Power Producer Procurement Programme (GASIPPPP) after all four bids failed to meet mandatory requirements, mainly because they could not provide sufficient assurances of gas supply.
Minister of Electricity and Energy Kgosientsho Ramokgopa announced the outcome on Wednesday, saying the government remained committed to developing gas-to-power capacity despite the unsuccessful procurement round.
The programme sought to procure 2,000 megawatts (MW) of generation capacity in line with the country’s Integrated Resource Plan (IRP) 2019 and IRP 2025.
The Department of Electricity and Energy received four bids offering a combined 2,830MW on 29 May 2026, following the release of a revised request for proposals on 20 October 2025.
However, the bidders failed to meet the mandatory functional criteria, with the department identifying insufficient guarantees of gas supply as one of the main reasons.
Although South Africa is potentially well endowed with natural gas, the country imports most of its gas requirements from Mozambique and does not have a liquefied natural gas (LNG) receiving terminal.
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Ramokgopa said the outcome would help government strengthen the conditions needed to make future gas-to-power projects viable.
“South Africa is not retreating from our gas-to-power objectives. As the first in Africa to take on this ambition, we are further enabled by this first procurement process to strengthen the conditions necessary to achieve them,” he said.
“Our responsibility now is to address the infrastructure, commercial and institutional conditions required to translate market interest into viable and deliverable projects.”
The department said the first procurement round had provided practical lessons on the challenges of translating the country’s gas-to-power ambitions into projects that could be implemented.
These included the need to align procurement requirements with technical feasibility, fuel supply arrangements, supporting infrastructure, affordability, environmental obligations and project readiness.
Gas-to-power remains part of government’s energy security strategy, as reflected in the IRP 2025.
The department said it would prioritise structured engagement with bidders and other market participants, including original equipment manufacturers, lenders, gas suppliers and terminal developers, to inform the programme’s future direction.
Any subsequent procurement process, including its requirements and timelines, will be subject to the necessary statutory, governance and procurement approvals.
The department said further information would be communicated through official channels before the end of the year.
It reaffirmed its commitment to procurement integrity, stakeholder engagement and advancing gas-to-power development in support of South Africa’s long-term energy security.
