Zimbabwe Competitive Procurement Ensures Fair Bidding

Zimbabwe is replacing unsolicited power project bids with competitive tendering, and the framework behind it is being built with World Bank technical assistance covering transaction advisers, model bidding documents and a pilot procurement of around 370MW across the Ministry, ZETDC and the regulator.

Competitive tendering for generation replaces the unsolicited bid in Zimbabwe, which until now allowed any company to submit a project proposal without invitation and negotiate a tariff directly with the regulator, and ZERA chief executive Edington Mazambani has been blunt about what that produced, saying applicants had been “seeking licences for speculative purposes” and using them to raise finance rather than to build.

Behind the policy sits the machinery, and that is where the World Bank programme comes in, funding transaction advisory services, the development of a procurement framework and standard model bidding documents, alongside capacity building across the Ministry of Energy and Power Development, ZETDC and ZERA, with a pilot procurement of around 370MW intended to test and refine the framework before it is used at scale.

Running a credible tender requires things Zimbabwe has not had to produce before. Bid evaluation criteria, a standard power purchase agreement that lenders recognise, a bankable offtaker position and a timetable developers can plan against are all different disciplines from assessing proposals as they arrive.

Against that sits the market the reform is trying to attract. Around 200MW of solar is installed in Zimbabwe, most of it behind the meter at private sites rather than feeding the grid, and the bankability problem that kept it there has not gone away, since long-term agreements with ZETDC carry no sovereign guarantee behind them.

Retail liberalisation is arriving at the same time, with Statutory Instrument 128 opening distribution and supply to private operators on 25-year licences while ZETDC keeps transmission and makes its substations and lines available for private use, so generation and supply are being opened within months of each other.

Whether the tender produces plants rather than licences is the test, and Mazambani’s own diagnosis is the standard to judge it by.

Source: Zimbabwe Competitive Procurement Ensures Fair Bidding – Energy News Network

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