Government leans towards renewable energy but needs to grasp it with both hands
Despite policies for the expansion of renewables there has been resistance from Eskom, the government and unions
Renewables have found favour with the SA government after President Cyril Ramaphosa’s economic recovery plan in response to the Covid-19 pandemic.
The intention is to procure half of the 11,800MW proposed additional capacity from renewables within two years as part of planned infrastructure growth and employment creation. This future growth in renewables as a source of electricity generation is appropriate.
The preference for renewables is justified when the much shorter lead times are considered. The average construction times for wind plants are less than two years. This is much better than coal plants such as Medupi and Kusile that have taken more than 10 years to construct, with some of their units still due for commissioning.
Plans for extensive infrastructure development cannot be supported by the existing coal power plants, which experience unplanned outages frequently due to old age and poor maintenance.
Load-shedding has been a regular feature of SA’s electricity supply, with outages experienced on 46 days in 2019 alone. The average energy availability factors (EAF) of existing coal plants is just 66.64%, with some due for decommissioning. New capacity is required urgently.
SA has good policies for the expansion of renewable energy, but their implementation has met with a lot of resistance from Eskom, the government and unions in the past. Ministers of energy often delayed the signing of procurement contracts with independent power producers (IPPs) after the conclusion of renewable energy IPP procurement programme bid windows.
Despite the obligation to purchase electricity from IPPs, Eskom also stalled the processes. Consider the solar-water heaters programme, for which a tender was issued in December 2015 and 87,206 heaters procured, yet only 350 were installed in the 2018/2019 financial year, with no installations in 2019/2020. The remainder of the solar water heaters are in storage at exorbitant storage fees. These are clear implementation failures.
Some policies are designed to protect Eskom from competition. Electricity generation for own use is limited to small capacities, which are too low for significant sales of excess capacity back to the grid. Allowing excess capacity to be sold to Eskom would alleviate the strain on Eskom’s generation capacity.
If IPPs are obliged to sell to Eskom why not also individuals and industries that can generate large excesses? The president’s intention to relax the regulatory constraints is well and good, but if the IPPs are still forced to sell to an Eskom that has a monopoly over the transmission network, how far does competition in the electricity sector really go?
Though storage for renewable power is being developed, it is still inadequate and raises the costs of procuring renewable power. Backup options are therefore critical. Gas is one option. The low emissions attributes of gas make it a useful substitute for coal and a suitable transition fuel to renewables. The use of gas as backup is constrained by lack of developed domestic gas supplies.
Gas discoveries at Brulpadda and Luiperd, as well as the possible shale resources in the Karoo region, will take years to develop (if they ever get developed). Gas is now used in the peaking plants, but the costs are high. Relying on SA’s regional partners for supplies has risks of security of supply. The risks are worsened by regional conflicts such as domestic conflicts in Mozambique.
Expansion of renewable power presents an employment conundrum since renewables will eventually crowd out other electricity options and lead to job losses, especially in the coal sector. The domination of the renewable energy sector by foreign companies should not be left unchecked. SA must strive for the expansion of local manufacturing of components of wind and solar plants. Localisation needs to become more than just rhetoric.
SA must clearly delineate its priorities in terms of short-term and long-term goals regarding job creation, revitalisation of the economy and environmental concerns. An appropriate energy mix that minimises trade-offs among the priorities must be chosen. Funding of the energy sector must be urgently addressed as many projects failed in the past due to funding constraints.
With all these considerations, meeting the country’s energy needs within two years could be a reality if the task is tackled with sufficient vigour.
• Maqanda is a chemistry lecturer at the University of Fort Hare and PhD student in economics at Rhodes University.
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