An aerial view of the Khanyisa solar plant at Gold Fields’ South Deep mine in Johannesburg. Photo: Supplied
- The government has finally removed the license threshold for private power generation, meaning that solar and wind projects of any size can now be built without a license.
- The National Energy Crisis Committee expects this to significantly accelerate private power.
- In a report on his progress, Necom said a special meeting of the National Security Council will be convened next week to tackle criminal syndicates and sabotage at power plants.
- For more financial news, go to News24 Business Cover.
As South Africa suffers a record load cut, the National Energy Crisis Committee (Necom) has reported on progress in implementing President Cyril Ramaphosa’s energy crisis plan, which was announced last year.
The latest developments include the government finally lifting the license threshold for private power generation projects.
New legislation has been published to remove the 100MW license threshold for these projects. This means that solar and wind projects of any size can be built without a license.
Towards the end of 2021, the government raised the threshold from 10MW to 100MW.
Since then, private sector companies have launched 100 projects that will bring more than 9,000 MW to the grid. Eskom’s entire fleet has a capacity of around 45,000 MW.
The first of these private sector projects should be connected to the electricity grid by the end of 2023. Necom expects the recent removal of the licensing threshold to “significantly” accelerate private investment.
special security meeting
As breakdowns at Eskom’s old power stations are compounded by sabotage and crime, Necom also said Ramaphosa has instructed law enforcement agencies to step up efforts to protect power infrastructure.
A special meeting of the National Security Council will be convened next week. The council will consider a report on efforts to stop criminal syndicates and sabotage at power plants. So far, 67 cases are on the court list for theft and fraud at Eskom.
Necom’s Report
Convened by Phindile Baleni, CEO of the Presidency, Necom is made up of senior government officials from various departments, as well as Eskom representatives.
Necom said progress with the energy crisis plan included:
- Before the end of the month, Eskom will launch a new program that will offer financial incentives to electricity users who do not use power during peak hours. No details are yet available, but the incentives are expected to form part of Eskom’s Demand Response Program, which compensates large companies that are able to reduce their energy use at peak times. A national campaign to encourage electrical efficiency will also be launched this month.
- A total of 162 MW of excess capacity has been identified from existing independent power producers. Eskom plans to buy up to 1,000 MW from private companies over three years. The first contracts are expected to be signed in the coming weeks.
- The government hopes to launch a request for new offers to establish battery storage projects soon. A similar request for gas power will follow in March 2023.
READ | Government plans 3,000 MW of gas-fired electricity as part of new energy push
- New legislation to establish an independent transmission and system operator and a “competitive electricity market” has been finalized and will be presented to cabinet this month. This is part of Eskom’s move to split up its transmission business.
- Some 200 MW have been sourced from neighboring countries since September last year, with another 1,000 MW identified by 2023.
- A “one stop shop” is being established as a single entry point for energy projects through Invest SA, South Africa’s investment promotion agency.
- Eighteen specialists have returned to Eskom, including three appointments from former Eskom employees as power station managers at Kendal, Koeberg and Medupi. More than 1,000 people have volunteered their skills through Eskom’s crowdsourcing platform.
READ : If you have the skills to help troubleshoot Eskom, this is a new way to offer your services.
A team of independent experts has also been established to work with Eskom to diagnose problems in underperforming power plants and take action to improve plant performance.
Six power plants have been identified for a particular focus in the coming months, with oversight by Eskom’s new board.
- There has been progress in cutting red tape for energy projects, including reducing the time frame for environmental authorizations from 100+ days to 57 days; reduce the registration process from four months to three weeks; and ensure grid connection approvals are delivered within six months, Necom said.
- Construction will soon begin on 19 Bid Window 5 projects and six Bid Window 6 projects in the renewable energy program, representing 2,800 MW of new capacity.
- A new ministerial determination for 14,771 MW of new generation capacity from wind, solar and battery storage has been published to expedite new bidding windows.
Diesel?
The crisis plan progress report did not cover the quick fix to reduce load shedding: solving Eskom’s diesel problem.
The financially strapped utility does not have enough money for diesel to run its open-cycle gas turbine plants, which provide emergency power and reduce load shedding.
The Treasury has not caved to Eskom’s demands for more taxpayer money to pay for diesel. Eskom’s application for a license to import its own fuel so it can buy diesel at basic fuel prices has also been rejected by the energy department.
