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Breytenbach welcomes greater certainty for renewable energy projects

IPP Office CEO Karen Breytenbach

IPP Office CEO Karen Breytenbach

Photo by Dylan Slater

19th October 2018

By: Kim Cloete

Creamer Media Correspondent

     

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Participants in the renewable energy sector say they are encouraged by the dedicated infrastructure team that will be set up in the Presidency, as it will give investors more certainty and confidence to back projects.

“We’ve seen what the last two years of delays in the signing of renewable projects did to us. I think the politicians have realised too. You need an infrastructure unit that takes ideas, conceptualises them, puts them out to market and makes sure they happen,” Department of Energy Independent Power Producer (IPP) Office CEO Karen Breytenbach said on Thursday.

She told delegates attending the Sub Saharan Africa Power 2018 conference, in Cape Town, that she was very pleased that the unit would be set up as it was vital to retain investors.   

She said the renewable energy sector was recovering well after a rocky two years, in which the signing of renewable energy contracts was delayed under former President Jacob Zuma.

Power purchase agreements for 27 renewable energy projects were eventually signed in April.

Breytenbach stressed that it was very important to rebuild trust.

“Suddenly investors battled to believe we could follow our own regulatory process. It was damaging. I think some of them will definitely come back if we get back to the rolling programme. We need to bring investors back into the manufacturing side.”

Vantage GreenX Fund Managers MD Alastair Campbell agreed.  

“When we had the two-year delay in South Africa, the developers moved off to countries like Chile. Now we have to get investors back onto the continent. We have to wake up. We have to create the environment where bankers come in and lend.”

Vantage GreenX recently announced it had committed funding of R2.05-billion to a combination of six solar and wind projects, bringing its total number of investments in renewable energy in South Africa to 14 across two funds.

Meanwhile, Breytenbach called for more support from banks and financial institutions for black entrepreneurs in the renewable energy programme.

“Radical economic transformation is incredibly important and we are still struggling to get this right.”

Breytenbach said, however, that she was very pleased that through the renewable energy programme, 600 bursaries for tertiary education in fields ranging from engineering to medicine and teaching, had been given to students.

“We need to steer that enterprise development so that there is an even bigger impact.”

In advice to African counterparts thinking of expanding their renewable energy programmes, she said it had been a good idea for South Africa to have a bidding tariff instead of feed-in tariffs, as prices dropped substantially.

“The Renewable Energy Independent Power Producer Procurement Programme offered clear opportunities for developers to make profits. Competitive tenders seem to have helped tariffs fall sharply. The reduction was a major factor in the government’s willingness to continue its support for the programme.”

Breytenbach told Engineering News Online she was pleased about the large share of renewables included in the draft Integrated Resource Plan 2018.

“Renewables have a great future. We cannot [continue living] on this planet in the way we are living [now].”

However, she said the IPP Office was considering adapting the model for renewable energy projects.

“We know a lot of people will go off grid, so we have to make sure we don’t burden the State with too many long-term contracts. We are thinking that maybe a mix of long-term models and short-term initiatives would work well. Embedded generation and rooftop photovoltaic are definitely a firm part of the mix.”

Edited by Creamer Media Reporter

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