‘I am going to be ultra-aggressive on the renewable energy side. I think we have taken a bit longer than what is necessary,” said Kgosientsho Ramokgopa, the newly appointed minister of electricity and energy, at Tshedimosetso House in Pretoria on Monday.
“I want to say to you that I am a firm believer that it’s a mix that matters,” he said, “and you are going to see an exponential share of renewables in the energy mix. And we need to signal to the market our intention to go that route.”
What happened to the renewable IPPs?
In the 13 years since the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) was introduced, only 6,200 megawatts (MW) have been added to the national grid.
Silas Zimu, Ramokgopa’s energy adviser, said earlier this year that the last renewables connected to the grid were from REIPPPP Bid Window 4.
The programme signed its fifth round of IPPs at the end of 2022 under Bid Window 5 — but those projects (meant to add 2,583MW of power) are expected to be added to the grid only in 2025.
Read more in Daily Maverick: How the ANC’s years-long delays on renewables plunged SA into darkness and scuppered plan to end blackouts
On Monday, Ramokgopa said, “A pre-eminent question that ought to be answered is the following: What were the experiences and the hurdles associated with the previous bid windows that undermined the ability of the project sponsors to get to financial close? That undermined the ability of financiers to have the appetite to participate?
“I want us to resolve those. I don’t think it’s going to take us long… I’m sure they’ve documented them somewhere.”
Speaking of the “mega-bid window” that he unofficially announced in April last year, Ramokgopa said, “I really am not of the opinion of going out to the market in bits and pieces. I believe in a mega-bid window.”
But unlike last year when he unofficially announced plans for a “mega-bid window” of more than 15,000MW (15 gigawatts) of additional renewables, Ramokgopa kept the specifics vague, saying, “It will be bigger than the other big windows that you see. What scale? I’ll answer that question at the right time. But I’m sure that it will be something unprecedented.”
Ramokgopa said that last week he engaged with all the internal key players in the renewable energy space — the Independent Power Producer offices and the previous Department of Mineral Resources and Energy — and would soon engage with external players.
He noted that it would be important to engage with new Trade, Industry and Competition Minister Parks Tau to ensure that this bid window had a substantial share of local players.
“I will sit with everyone [until] we agree — the commercial banks, project sponsors, Eskom, IPPs — to say to them, I’m going out [to market].
“Let’s show the country and the rest of the world that we can do it. We are going to be the leaders on this continent in relation to renewable energy. And it’s important I make that point.”
A hundred days with no load shedding
Ramokgopa noted that Friday, 5 July marked more than 100 consecutive days without load shedding. “It’s not a moment of celebration, but it’s just for us to take stock of where we came from and the fact that these interventions are working and they’re beginning to illustrate that indeed it can be done.”
The Energy and Electricity Department reported that the energy availability factor (EAF) of SA’s fleet for the year to date was 61.5% — 7% more than in the same period last year.
Ramokgopa said this was not just due to using diesel to pump open-cycle gas turbines (OCGTs). He pointed to the fact that in week seven of the 2023 financial year (in May), Eskom spent R97-million on diesel, while in the same week this year that was reduced to R6-million. There was an R6.2-billion reduction in OCGT diesel expenditure from 1 April to 30 June, compared with the same period last year.
“There’s nothing about diesel that’s anchoring the kind of performance we’re seeing now; it all has to do with the performance of the coal-fired power stations and the work that the team has done,” said Ramokgopa.
Municipal issues
However, while noting the progress Eskom had made, Ramokgopa said, “Today I stand before you with a new crisis … we are having a situation where many households are experiencing situations from one day to the other where they don’t have electricity.”
https://www.dailymaverick.co.za/article/2024-07-08-as-load-shedding-goes-local-the-power-gap-between-rich-and-poor-widens/
He said that now the generation of electricity was meeting the demand, there was another issue: the perennial under-investment in the distribution infrastructure (transformers and substations) by municipalities, along with poor planning, management and technical capacity.
“The distribution infrastructure does not have the capacity to meet the reticulation demand,” he said.
Ramokgopa said issues that needed to be solved included:
- The failure of some municipalities to ring-fence their electricity businesses;
- Poor revenue management and payment culture;
- Ailing and outdated grids;
- Inadequate maintenance and infrastructure investment; and
- Theft, vandalism and technical losses.
“Those who can afford to pay, have to pay. We must deal with this while protecting the poor,” he said.
Addressing energy poverty
Ramokgopa’s plan to protect the poor and address energy poverty involves repurposing grant money from the Integrated National Electrification Programme (Inep) to provide off-grid solar solutions for those who can’t afford electricity.
“The rich are able to buy solar panels, inverters, batteries … and they are able to harvest the sun to meet their energy requirements.
“However, the poor cannot do that. While the sun is out, a source of energy, they are protesting to say, ‘We want electricity,’ because they can’t harvest that energy, because they are not sitting with unencumbered cash.”
Ramokgopa said the primary function of Inep grants was for electrification. “It’s to make sure that we achieve universal access as an injunction that we draw from the National Development Plan.”
According to a Treasury document, Inep “provides for capital subsidies to municipalities to address the electrification backlog of all existing and planned residential dwellings (including informal settlements, farm dwellers, new and existing dwellings) and the installation of relevant bulk infrastructure”.
Ramokgopa said, “We say that you need to repurpose that grant to ensure that you have non-grid solutions to be able to provide electricity access to the poor in particular.
“We know that there’s a trusted technology, a proven technology that we can use,” said Ramokgopa, adding that his ministry had seed capital of R5-billion per annum, which he wanted to repurpose to roll out off-grid solutions.
“There’s nothing novel about what I’m suggesting. We’re simply saying that these are done in other parts of the world,” said Ramokgopa, referring to his department’s plans to evolve in accordance with global trends like decarbonisation and decentralisation.
“We’re going to be very aggressive and address the situation of energy poverty and show that the poor have got the same means of access to renewable sources as the rich have.” DM
https://www.youtube.com/watch?v=REeWvTRUpMk