5-Year maintenance and spares supply contract for kaeser compressors and dryers at kendal power station

Scope: Maintenance of Kaeser Compressors, Dryers, and supplying spares on an as-and-when-required basis.

Duration: 5 years (60 months).

Buyer: Tsepiso Mahlangu

Department: Gx Kendal Power Station

Compiled by: Emmanuel Shakhane (Senior Advisor, Supplier Development, Localisation and Industrialisation)

Reviewed by: David Pule (Middle Manager: SDL & I)

Submit the following returnable documents:

• SBD 6.2 Declaration Form (mandatory if applicable).
• Annex C (Local Content Declaration - Summary Schedule) (mandatory if applicable).
• SDL&I Implementation Schedule (to be completed and returned within 28 days of contract award).

Reporting and Monitoring:

• Submit quarterly SDL&I compliance reports to Eskom using the Data Collection Template.
• Eskom will review reports within 30 days and notify suppliers in writing of non-compliance.
• Implement corrective measures before the next reporting period if non-compliant, or retention clauses will be invoked.

NOTE: SBD 6.2 Declaration Form and Annex C (Local Content Declaration-Summary Schedule) are therefore mandatory and must be tender returnables, if applicable.

Scope of Work:

• Maintenance of Kaeser Compressors and Dryers.
• Supplying spares on an as-and-when-required basis.

Contract Duration: 5 years (60 months).

Skills Development:

• Tenderers must take full responsibility for the cost of developing skills.
• Eskom provides no financial contribution.
• Approach: Collaborate with SETA-accredited training providers for critical and scarce skills development.
• Excludes Eskom employees and registered learners.

Pricing Structure:

• Tender response must be separated into components as per the Price Schedule.
• Local procurement content = total spending minus imported component.

Pricing and Local Content:

• Tender response must be separated into components as per the Price Schedule included in the tender documents.
• Local procurement content is calculated as total spending minus the imported component.
• Eskom target for local procurement content: 100%.

Performance Security:

• Eskom retains 3% of every invoice (excluding VAT) as security for SDL&I obligations.
• Retained amounts are released only upon fulfilment of all SDL&I obligations.
• Penalty of 3% of contract value applies for failure to meet SDL&I obligations.

B-BBEE Requirements:

• Valid B-BBEE certificate issued by a SANAS-accredited verification agency, sworn affidavit, or CIPS affidavit is required to claim preference points.
• Submit proof of ownership/shareholding (preferably CIPC documentation) with shareholding breakdown.
• Certified ID copies of shareholder(s).
• Proof of Disability (where applicable).
• For trusts, consortia, or joint ventures: consolidated B-BBEE status level verification certificate.

B-BBEE Thresholds by Revenue:

• Annual Total Revenue ≤ R10M: Exempted Micro Enterprise (EME) – submit Sworn Affidavit.
• Annual Total Revenue ≤ R50M: Qualifying Small Enterprise (QSE) – comply with all QSE scorecard elements unless ≥51% Black-owned (Sworn Affidavit acceptable).
• Annual Total Revenue > R50M: Valid B-BBEE certificate required.

B-BBEE Improvement Plan:

• Submit within 30 days of contract signing.
• Level 1: Maintain status.
• Level 2 or 3: Improve or maintain B-BBEE status over the contract period.
• Level 4: Achieve Level 3 by end of first year, then improve by one level annually.
• Level 5–8 or non-compliant: Achieve Level 4 by end of first year, then improve by one level annually from the second year.

Local Content and Subcontracting:

• Subcontract at least 15% of scope to EME/QSE with ≥51% Black Ownership (BO).
• Preference for local suppliers from Kendal Feeder areas.
• Designated components must meet local content thresholds:
• Cabling: 90%.
• Valves: 70%.
• Steel Pipes: 100%.

Job Creation and Skills Development:

• Submit proposals for jobs created and retained in South Africa.
• Source candidates from Kendal Feeder areas for job and skills development opportunities.
• Skills development targets:
• Mechanical Technicians: 3 candidates (N3/Matric/National Certificate/Diploma).
• Bursaries must be for a minimum of 24 months.
• Candidates must be from previously disadvantaged groups, sourced locally.
• Tenderers bear full cost of skills development; Eskom provides no financial contribution.

B-BBEE Documentation Requirements:

• Valid B-BBEE certificate (SANAS-accredited), sworn affidavit, or CIPS affidavit.
• Proof of ownership/shareholding (CIPC documentation preferred) with breakdown.
• Certified ID copies of shareholder(s).
• Proof of Disability (if applicable).
• Consolidated B-BBEE certificate for trusts, consortia, or joint ventures.

B-BBEE Improvement Plan:

• Submit within 30 days of contract signing.
• Level 1: Maintain status.
• Level 2–3: Improve or maintain status over contract period.
• Level 4: Achieve Level 3 by end of first year, then improve annually.
• Level 5–8/non-compliant: Achieve Level 4 by end of first year, then improve annually from second year.

Local Procurement and Subcontracting:

• Local Procurement Content: Value added in South Africa by South African resources.
• Subcontract 15% of scope to EME/QSE with ≥51% Black Ownership.
• Preference for local suppliers from Kendal Feeder areas.
• Designated sectors: Cabling (90%), Valves (70%), Steel Pipes (100%).

Job Creation:

• Submit proposals for jobs created and retained in South Africa.
• Source candidates from Kendal Feeder areas.

Skills Development:

• Target: 3 Mechanical Technicians (N3/Matric/National Certificate/Diploma).
• Bursaries: Minimum 24 months.
• Candidates: Previously disadvantaged groups, sourced locally.
• Tenderers advised to approach SETAs for grants and SARS for tax rebates.

SDL&I Penalty and Performance Security:

• Penalty: 3% of contract value for failure to meet SDL&I obligations.
• Retention: 3% of every invoice (excluding VAT) withheld as security for SDL&I obligations.
• Release: Retained amounts released only upon fulfilment of all SDL&I obligations.

Reporting and Monitoring:

• Quarterly SDL&I compliance reports to Eskom using the Data Collection Template.
• Eskom reviews reports within 30 days and notifies suppliers of non-compliance.
• Corrective measures must be implemented before the next reporting period; otherwise, retention clauses are invoked.
• SDL&I Implementation Schedule: Must be completed and returned within 28 days of contract award for monitoring and reporting.

Preference Points:

• Failure to provide B-BBEE documentation results in scoring out of 90/80 for price only and 0 points out of 10/20 for specific goals.
• Points allocated based on specific goals, including local content thresholds for designated sectors (e.g., Cabling: 90%, Valves: 70%, Steel Pipes: 100%).