South African Business 2016 edition

OVERVIEW Renewable

OVERVIEW Renewable energy South Africa’s renewable energy industry holds enormous potential for further development. Renewable energy holds the promise for a brighter future not only in South Africa, but Africa as a whole. In this context South Africa is well positioned to lead the continent forward, thanks to its internationally acclaimed Renewable Energy Independent Power Producer Procument (REIPPP) framework, under which “bidding windows” offer renewable energy power suppliers the opportunity to bid for projects that, once complete, feed into the national grid and contribute to South Africa’s energy security. REIPP has recently closed its fourth bidding window, testimony to the high repute in which the process is held. The fact is that the framework offers investors the reassurance of a robust business-friendly model, ensuring the sustainability of the sector as a whole. The ten preferred bidders, as announced by the Minister, are Adams Solar PV Project (Pty) Ltd, Bellatrix Solar PV Project, Du Plessis Solar PV4, Steynsrus PV2, Heuningspruit PV1, Steynsrus PV1, Klawer Wind Farm, Hopefield Community Wind Farm, George Small Scale Biomass to Energy and Busby Renewables (Biomass). The 13 preferred bidders in the renewable energy independent power producer procurement programme’s Bid Window 4 were announced in June. The 13 projects are tipped to supply an additional 1084MW of electricity to the national grid. To date, more than 6 000MW of electricity has been procured from 37 renewable energy independent power producers. Of course, South Africa’s renewable programme is not only about electricity but, also broader empowerment. The contribution of REIPPP projects to the broader national development objectives, including economic development, social upliftment, job creation, broad based economic empowerment and development of small and women owned vendors, is a hallmark of the programme. In addition to REIPP there is the Department of Energy’s Small Projects Renewable Energy Independent Power Producers (IPPs) Programme. Ten winners were announced this year at the South African International Renewable Energy Conference (SAIREC) 2015. The programme is targeted at independent power producers that can roll-out projects with the capacity to produce between one and five Megawatts of energy. This amounts to creating opportunities for small and medium sized entrepreneurs in the renewable energy programme. The intention of the programme is to assist small developers to gain assistance in project development as well as in raising the necessary funding projects of this nature. SOUTH AFRICAN BUSINESS 2016 142

OVERVIEW Africa could up its generation of renewable energy from 5% to 22% by 2030, according to Mr Adnan Amin, the Director- General of the International Renewable Energy Agency (IRENA). As the demand for electricity is projected to grow by 2030, renewable energy will contribute towards the electrifying of households across the continent. Africa’s electricity demand has increased by 80% over the past 15 years. Africa is rising but needs secure and affordable energy to power its future growth. Africa has bountiful and buried renewable energy resources, including excellent solar across the continent, hydro in many countries, strong wind resources and powerful geothermal in East Africa’s rift valley. Renewable energy deployment in Africa can reach 310 GW by 2030 on the basis of the technology and the business case that the world has today. More than 600-million people in Africa remain without electricity – the biggest unelectrified population in the world. This is expected to grow to 700-million by 2030, based on current trends. Renewable energy will be critical to lift these citizens from energy poverty. Access to electricity fulfils basic energy needs and can lead to a more accessible and reliable water supply, the extension of basic rural health care services and outreach of telecommunication services in rural areas. It is a means of stimulating economy wide development and a pathway to poverty eradication. 143 SOUTH AFRICAN BUSINESS 2016