The local government and Johannesburg utility City Power last year issued a request for short-term power purchase agreements. South Africa experiences electricity rationing on a regular basis as state-owned Eskom Holdings SOC struggles to meet demand.

The selected bids from companies using waste-to-energy, gas-to-power and solar generation technology provide cheaper electricity than using Eskom, City Power Chief Executive Officer Tshifularo Mashava said Thursday in a statement.

Johannesburg plans to add 500 megawatts of capacity by 2030. One megawatt is enough to supply about 650 households, Eskom says on its website.

Cape Town, the second-largest city in the country, also called for supply last year from independent power producers and has issued a tender to build its first grid-connected solar plant.

Johannesburg plans to install rooftop solar at over 700 sites and increase the number of solar water heating systems.

(Reporting by Paul Burkhardt)