South African Business 2020 edition

OVERVIEW
tion, transmission and distribution
and it is a monopoly. Mboweni’s
statement opens up the possibility
that a long-stalled plan to
divide up these functions could
happen. In 2013, a parliamentary
bill called the Independent
System and Market Operator
(ISMO) was passed but allowed
to lapse in the same year.
Figures released by the South
African Wind Energy Association
(SAWEA) showed shareholding
for local communities reached
an estimated net income of
R29.2-billion over the lifespan of
the projects. Some 14 000 new
jobs are expected to be created,
mostly in rural areas, and more
than R30-billion has already
been spent on Black Economic
Empowerment (BEE) in the
construction phase.
In 2018, then Energy Minister
Jeff Rabebe restarted the REIPPPP
when he signed off on projects
totalling R56-billion that will add
2 300MW to the national grid.
There had been a long delay
as Eskom argued against
accepting more power purchase
agreements. Most of South
Africa’s electricity comes from coal
and Eskom is building two huge
coal-fired power stations.
Most commentators on the
Integrated Resource Plan (IRP) 2018
have praised its basis in science
and the fact that it has adopted the
“least-cost” method of analysing
options. With renewable energy
costs having been dramatically
reduced, the IRP concludes
that wind, gas and solar power
(photovoltaic) will be the three
methods to be allocated the most
new projects up to the year 2030.
The other form of solar power (concentrated solar power, CSP) is very
effective and some projects have been successfully commissioned, but
it is relatively expensive.
A majority of wind projects have been allocated to the Eastern Cape,
but approximately 60% of the projects so far allocated in the programme
have been in the Northern Cape, the nation’s sunniest province.
Projects such as Kathu Solar Park (100MW), a concentrated solar power
(CSP) project, and the Roggeveld Wind Farm (147MW) are indicative of the
large scale of most of the energy generation that is being rolled out.
Abengoa’s three plants in the Northern Cape use CSP which reflects
the sun’s rays during the day into a molten salt storage system. The energy
is then slowly released during the night. The 205m tower that collects the
rays at the Khi Solar One site is one of the tallest structures in South Africa.
Despite the emphasis on renewables in the IRP, South Africa’s energy
mix is still weighted towards coal. The IRP has attracted criticism for
enabling an expansion of the coal industry. Koeberg nuclear power
station is due to be decommissioned soon after 2045.
Gas
While the main sources of renewable energy being pursued are solar
and wind power, an open-cycle gas turbine plant at Shakaskraal in the
iLembe District Municipality (pictured) points the way to another method
being encouraged by energy planners. This 670MW gas turbine plant
can be converted to gas-fired technology. Its project company, Avon
Peaking Power, is jointly owned by a community trust, Mitsui (Japan),
Legend Power Solutions (South Africa) and ENGIE of France, which is
the largest shareholder.
Gas in various forms is very much in the spotlight. South Africa’s
neighbour Mozambique has large offshore deposits and a sub-committee
of the Southern African Development Community (SADC) has been
tasked with working out a master plan for the region.
A study prepared by the Energy Centre of the Centre for Scientific and
Industrial Research (CSIR) reports that wind and solar power (supported
by natural gas, biogas and hydro-electric power) could be up to the task
of providing “baseload” power. The Department of Energy is targeting
the procurement of 3 126MW and intends spending R64-billion on port,
pipeline, generation and transmission infrastructure at three key ports.
ONLINE RESOURCES
IPP projects: www.ipp-projects.co.za
National Energy Regulator of South Africa: www.nersa.org.za
South African Renewable Energy Council: www.sarec.org.za
South African Wind Energy Association: www.sawea.org.za
SOUTH AFRICAN BUSINESS 2020
64