Eastern Cape Business 2018 edition

SPECIAL FEATURE
Renewable energy is creating new
opportunities
The Eastern Cape is a wind power hot-spot.
The Eastern Cape is home to two of the
eight Renewable Energy Development
Zones (REDZs) designated in a national programme.
The Environmental Management
Services unit within the Council for Scientific and
Industrial Research (CSIR) was responsible for identifying
suitable areas around the country. They had
to meet three criteria: the presence of good wind
or solar resources, good environmental conditions
that could withstand the presence of solar panels or
wind turbines and a high need for socio-economic
development.
Cookhouse and Stormberg are the two Eastern
Cape areas that are REDZ and hopes are high that
these concentrations of activity will lead to economic
growth and the creation of jobs for local communities.
There are already 12 wind farms in the Eastern
Cape. Because of this concentration of facilities, the
South African Wind Energy Association (SAWEA)
chose the province for its first SAWEA Provincial
Community Trust Workshop. With large amounts of
money coming into communities, proper attention
must be paid to who decides how that money is to
be spent and some regional planning is needed.
It does not make sense for each wind farm and its
closest community to plan a school and a crèche
if that is what the neighbouring community is also
planning. Community trusts have been established
as each of the independent power producers must
involve communities living within a 50km radius of
a wind farm.
Brenda Martin, CEO of SAWEA, outlined some of
the issues tackled at the workshops, “We explored a
range of approaches that are applied when establishing
the trusts for the benefit of local communities.
Many of the initiatives are focused on education,
health and the empowerment of women.”
The National Department of Energy has a programme
to attract private investment in renewable
energy, the Renewable Energy Independent Power
Producer Procurement Programme (REIPPPP).
According to figures released by the Department
of Energy, the REIPPPP by 2016 had not only delivered
multiple millions in investments, but also created
more than 30 000 jobs and benefited local community
development to the tune of R256-million.
However, the national utility, Eskom, has created some
uncertainty by refusing to sign new power purchase
agreements.
Although Eskom’s shareholder, the Minister of
Energy, said that the REIPPPP was still government
policy, it was not until 2017 that the process was
started again, but this time with a limit imposed by
the state on how much could be charged for energy
in new contracts.
Fully a quarter of the projects so far approved
in this national programme have been allocated
to the Eastern Cape with 91% of these being wind
projects and the balance solar photo-voltaic. A vast
new industry has been created in a very short space
of time, and investors still have an appetite for more.
If the power produced through the REIPPPP were
consumed where it is made, the Eastern Cape would
soon be producing 60% of its own needs (the power
is in fact sent to the national grid for redistribution).
The province consumed 8 358GWh electricity in 2015
or 3.7% of the national total.
The average lead time in the projects that have
so far been approved in the province is two years,
with local content averaging out at about 47%. When
the projects are complete, R142.9-billion will have
been spent on procurement, R65.7-billion of which
will be local.
Wind projects in the province include
Globeleq’s 138MW Jeffreys Bay facility, the 140MW
EASTERN CAPE BUSINESS 2018
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