a) City of Tshwane currently owns the Rooiwal Power Station (Facility) and has
realised that the Facility is not generating electrical energy to its full capacity. In
this regard the Council of the City of Tshwane has resolved to explore viable means
of ensuring that the Facility is generating Energy to its capacity.
b) The Rooiwal Power station was commissioned in 1963 and the last unit in 1970.
The installed capacity for Rooiwal PS is 300MW. The PS comprises five (5) turbo-
generator units, each rated at 60MW (Total of 300MW).
c) The repairs and maintenance budgets remain inadequate to run the power
generation to full capacity, and The City does not have adequate technical and
financial capacity to leverage on the potential of these assets to enhance the City’s
energy security
d) The City of Tshwane wishes to optimise the use of the Facility through de-risking
and leveraging third party resources for the refurbishment and upgrade of the
assets; and contributing towards meeting its current and future power needs.
e) The Facility can potentially provide substantial benefits to the City of Tshwane if,
amongst others, it is properly refurbished to enable it to possibly generate energy
to supplement energy purchased from national supplier Eskom Holdings Limited.
If the Facilities are fully functional, they could provide almost 20% of the Energy
required by the City of Tshwane and thereby increasing energy security and
contribute to alleviating the country’s electricity supply deficit.
f) The City of Tshwane intends to procure suitable and experienced transactional
advisor (TA) to assist the city in preparing the documents and providing
professional advisory services to assist the City of Tshwane to select and appoint
the Bidder to assume ownership, through a lease agreement, of the Rooiwal power
station for purposes of generating Energy to the possible maximum capacity of the
Facility
City of Tshwane view on the Rooiwal Power Station lease Project
g) For the potential Bidders, the Project offers an opportunity to provide City of
Tshwane with a Proposal for the restoration of the Facility to its possible maximum
capacity.
h) The Project will be implemented on a Lease basis; the Bidder will take ownership
of the Facility for the Lease Period with obligations to carry out the Project. On
expiry of the Lease Period the ownership of the Facility will revert to the City of
Tshwane.
i) The Project will be implemented through leasing of the Facility to the successful
Bidder, then the City of Tshwane intends to conclude a PPA with the successful
Bidder for the purchase of the Energy Generated from the Facility.
j) Accordingly, the Project will, amongst other things, seek to: -
i. integrate design, construction, operations and maintenance to achieve
optimum lifecycle cost balance.
ii. promote a viable risk sharing regime between the Bidder and City of
Tshwane; and
iii. strive for excellence from the Bidder in the provision of a service based
on a payment mechanism that incentivises the Bidder to perform.
k) The Bidder will be a single legal entity, resident in South Africa for tax purposes
and competent to transact with City of Tshwane as such.
l) The Bidder will be required to assume a substantial portion of all forms of project
life-cycle risk (including design, construction, financing, operation, and
maintenance risks, and closure of the Facility at the end of the term).
m) The expected benefits to the municipality- The maximum functioning and operation
of the power station will provide the City with reliable energy sources. The key
benefits for the City include the following:
i. Unlocking rental revenue as part of ongoing measures to enhance the City’s
cash position.
ii. Reducing and/or eliminating maintenance costs.
iii. Enhancing residual value.
n) Once services have commenced, the Bidder will be entitled to sell the electrical
energy to the City of Tshwane, and the City of Tshwane will be obliged to buy the
Energy from the Bidder on terms and conditions set out in the PPA and approved
by NERSA and related authorities.
o) The CoT wishes to invite an experienced transaction advisor to provide
professional advisory service to lease and develop the Rooiwal PS.
4. GLOSSARY OF TERMS
The following acronyms are used in this bid
BEC Bid Evaluation Committee
BAC Bid Adjudication Committee
B-BBEE Broad Based Black Economic Empowerment
CSD Central Supplier Database
CoT City of Tshwane
MFMA Municipal Finance Management Act
MSA Municipal Systems Act
PSC Project Steering Committee
RFP Request for Proposal
RFQ Request for Qualification
TA Transaction Advisor
5. DEFINITIONS
The following definitions are used in this tender invite:
5.1. Bidder means the bidding entity either by way of consortia or joint ventures or
individual entity, that bids for the Rooiwal Power Station Project.
5.2. General Conditions of Contract means the contractual conditions set for
arrangements between government institutions and private entities, obtainable
from the National Treasury website on www.treasury.gov.za;
5.3. Project means the development of a Rooiwal Power Station for City of
Tshwane.
5.4. Project Steering Committee means the committee established by the Project
Officer to steer the project and to ensure delivery on all project objectives.
5.5. Tenderer means any prospective professional firm that tenders for the work
under this RFP.
5.6. Request for Proposal means a set of documents issued by the procuring
authority that set out: the basis or requirements for submitting the proposal
(which documents and in which format and contents the bidder has to submit)
and the basis of the evaluation criteria for selecting the preferred bidder or
awardee. It is an invitation to the interest bidder to participate in the
procurement process.
6. DISCLAIMER
The information contained in these tender documents has been prepared by the City
of Tshwane in good faith based on information obtained from various sources. While
all reasonable care has been taken in preparing these tender documents the
information contained herein does not purport to be comprehensive to have been
verified by the City of Tshwane or any of its officers, employee’s agents or any other
person. Accordingly, neither the City of Tshwane nor any of its advisors make any
representation or warranty or give any undertaking express or implied, or accept any
liability or responsibility for the adequacy or completeness of any of the information or
opinions stated herein or any other written or oral information made available in
connection with this process and nothing contained herein is, or shall be relied upon
as, a promise or representation or whether as to the past or the future.
These tender documents may not contain all information which may be requested by
tenderers to develop their tenders. Each tenderer should conduct its own independent
analysis of these requirements, and the relevant data supplied or referred to herein or
that have been obtained during its investigation. The terms and conditions set out in
these tender documents is stipulated for the express benefit of the City of Tshwane
and save as expressly stated to the contrary, may be waived at the City of Tshwane’s
discretion at any time.
The City of Tshwane reserves the right to amend, modify or withdraw or cancel this
tender or terminate any of the procedures or requirements prior to closing of the tender
and in respect of which this tender has been issued, through public notice to the
tenderers. The City of Tshwane also reserves the right to appoint in part or full or not
at all by notifying the successful applicant which sections will be commissioned, and
which section will be excluded. The City of Tshwane and its staff shall not under any
circumstances be liable for any cost, damages or expenses incurred by tenderers as
a result of the above amendments, modification or cancelation of this tender.
Tenderers submitting a tender will be deemed to do so on the basis that they have
satisfied themselves as to the authority of the City of Tshwane to procure these
services and to be fully acquainted with the laws of South Africa (including without
limitation all statutes and regulations on a national, provincial and local government
level) to the subject matter of these services. Tenderers are therefore, at any stage of
the procurement phase and service contract, not entitled to request any advice or
opinion from anyone or more of the advisors to the City of Tshwane on the competency
of the City of Tshwane to procure the services in relation to the Project. The City of
Tshwane reserves the right to request clarification on any of the tenders submitted in
respect to this tender, without liability to compensate or reimburse the tenderer. Any
response by a tenderer to this tender does not imply that the City of Tshwane is
assured of the tenderer’s financial stability, technical competence or ability in any way
to carry out the requirements of this tender.
Requirements for sealing, addressing, delivery, opening and assessments of tenders
are further stated in these tender documents.
7. SCOPE OF SERVICES REQUIRED
The scope of services expected in terms of the lease and development of the Rooiwal
Power Station is detailed below. The successful bidder to be appointed as
transactional advisor (TA) will assist the in developing the scope of work (specification)
for the request of proposal to be issued by the City as part of the process to lease and
develop Rooiwal power station. The TA will advise and assist the city from the start of
the transaction until successful financial closure of leasing the Rooiwal power station.
The prospective bidders
are expected to submit a comprehensive bid with priced deliverables and timelines
which corresponds with the scope of work.
7.1. DELIVERABLE 1: INCEPTION REPORT
The inception report should describe the understanding and interpretation of the
service provider’s plan of action or approach which will cover key elements as
indicated in the Terms of Reference. In addition, this will cover timelines required for
conducting the study. Further information to enhance this approach will be considered.
7.2. DELIVERABLE 2: NEED AND STATUS QUO ANALYSIS
The needs and status quo analysis gives definition to the proposed project, preparing
the way for the technical solution options analysis. This should, demonstrate that the
project aligns with the municipality’s strategic pillars / objectives and IDPs. Summarise
the municipality’s mission and vision statements, its strategic objectives and
government policy that determines what the municipality’s deliverables are. This
should cover demographics, trends, and review of current plans, policies, legislation
etc. Identify and analyse the available budget. Demonstrate the municipality’s
commitment and capacity. Conduct the SWOT analysis (Strength, weakness
(limitations), threats and opportunities in the land parcels of the City owned land
around Rooiwal Power Station.
7.3. DELIVERABLE 3: TECHNICAL DUE DELLIGENCE
The due diligence stage aims to uncover any technical issues on the power station. It
is an unbiased audit of the station. This in-depth analysis will eventually identify
potential risks, the advantages and disadvantages of investing in the Power station.
This should include but no limited to assessment of all infrastructure assets of the
power stations, supporting assets like railway, roads, values assessment, life spans
of assets. Undertake analysis and surveys on environmental matters- Air quality,
climate and noise (Basic scoping), geo-technical matters, heritage matters, Water Use
License, Occupational health and safety, waste management etc.
7.4. DELIVERABLE 4: LEGAL DUE DELLIGENCE
This is a legal and regulatory analysis on the leasing and development of the Rooiwal
Power Station. The legal and regulatory analysis will include a review of the Legal
Frameworks that may impact the implementation of the project. This will include South
African Legislation (National, Provincial, Local) as well as Regulations governing
Legislatures. This should cover; Legal issues, Site enablement issues including the
following (Land ownership, Land availability and any title deed endorsements,
Potential land claims, Lease interests in the land, land consolidation and classification,
Zoning rights and town planning requirements. In addition, this should analyse existing
contracts which might negatively affect the development of the Power Station.
7.5. DELIVERABLE 5: ECONOMIC AND FINANCIAL ANALYSIS
This is economic sense and soundness of the proposed investment. This should be
accompanied by financials to establish commercial viability of the proposed
investment in the Power Station. The financials should cover, NPV, IRR, and ROI,
Payback period etc. Conduct value for money assessment and determine appropriate
transfer of financial risks from the municipality to the private party. Analyse the socio-
economic impact of the development. A report should cover these elements and
beyond.
7.6. DELIVERABLE 6: STAKEHOLDER ANALYSIS
The Transaction Advisor shall identify and conduct an overview of each of the
participating organizations involved in the Project, including the public and private
sectors, as well as organized labour as part of the stakeholder engagement analysis.
This should consider employees currently employed at the station. Develop a plan of
consultation and absorption guided by the Labour relations act and other relevant
legislation or policies.
7.7. DELIVERABLE 7: RISK ASSESMENT
The TA to conduct comprehensive risks assessment of the development. This should
consider all relevant risks of the project. A risk matrix and register should be
developed.
7.8. DELIVERABLE 8: PROCUREMENT PLAN
Investigate and analyses procurement option of the development, leasing been the
first priority. Analyse these options against applicable legal legislation – (National,
Provincial, and local). This should include development of RFP and contract.
7.9. DELIVERABLE 9: PARTICIPATE IN COMMITTEES
The TA is expected to participate in the Bid Specification Committee (BSC) and Bid
Evaluation Committee (BEC) established to process the bids.
7.10. DELIVERABLE 10: PARTICIPATE IN NEGOTIATIONS
The TA is expected to assist the city in contract negotiations. The required assistance
will be detailed in the service level agreement.
7.11. DELIVERABLE 11: PUBLIC PARTICIPATION
The TA in consultation with the City shall arrange the Public Participation or
Consultation where necessary.
7.12. DELIVERABLE 12: MANAGEMENT OF THE TRANSACTION ADVISOR
A TA should nominate a liaison(s) an experienced professional(s) to manage the TA
team. A professional should coordinate the activities of various TA team members.
The City of Tshwane will establish a project team (Project Steering Committee) to
engage regularly with the TA to efficiently complete the various delivery items. The
Project Steering Committee will meet at least monthly, and the TA’s liaison (s) will
report progress at these meetings.
7.13. DELIVERABLE 13: REPORTING
7.13.1. In addition to the above, meetings will be scheduled to coincide with the
key deliverables of the TA in the delivery of the project.
7.13.2. The City of Tshwane’s Chief Operation Office (COO) or the nominee will
verify and confirm that the TA has satisfactorily completed each delivery before
invoices can be submitted for payment or compensation to be approved.
7.13.3. Within two months from the commencement date, the TA will submit an
Inception Report giving a detailed work plan and assignments for everyone in
the team. This is a report to guide the timelines and deliverables as expected
from the appointed TA.
7.13.4. The TA will submit monthly progress reports as may be agreed to
describe the progress of work and further planned actions, an updated work
schedule, and any key constraints encountered by the team in the performance
of the activities.
7.13.5. The monthly detailed progress report and presentation (Microsoft
PowerPoint) in the following format Microsoft Word, PDF is required.
7.13.6. The reports submitted by the TA will be approved within such a period
as will be agreed with the City of Tshwane, to ensure that there are no delay or
disruptions to the TA activities. Reports will be submitted in respect to key
deliverables for decision making and approval.