The Southern Africa Power Pool (SAPP) is expecting growth in regional electricity trade in 2017 after a return to surplus power generation capacity across Southern Africa, led by South Africa’s State-owned utility Eskom. Nevertheless, the potential for cross-border electricity trade is expected to remain constrained by inadequate transmission and interconnector capacity.
Speaking at the power pool’s management committee meeting in Pretoria on Thursday, SAPP chairperson Ernest Mkhonta reported that trade flows increased to a value of $76-million in 2016/17, representing about one-million megawatt-hours (MWh). However, this still represented only 37% of what the region could have traded during the year had it not been undermined by a lack of transmission infrastructure.
The immediate growth outlook was promising, though, with 4 180 MW of new or rehabilitated generation capacity added by member States last year; a figure that was 11% ahead of target.
Between April and August, 700 000 MWh was traded through the SAPP platform, which represented more than 50% of volumes achieved for the full 12 months last year. Therefore, SAPP was expecting full-year volumes to rise to around 2-million MWh in 2017/18.
South Africa’s Eskom was particularly keen to expand its cross-border exports, owing to falling demand in its home market and the prospect of a growing surplus as additional units at the Medupi and Kusile coal-fired power station were introduced.
At the end of April, the region’s operational capacity stood at 54 397 MW against demand of 53 478 MW. Total installed capacity stood at 59 539 MW and it was anticipated that 3 672 MW would be added this year, including 1 234 MW from South Africa and 1 727 MW in Angola.
Acting Eskom Enterprises CEO Abram Masango told delegates that the utility had “turned the corner” and was keen to sell its operating surplus into the rest of Southern Africa. Eskom had set a target of increasing cross-border sales by 8% a year over the next five years.
Energy Minister Mmamoloko Kubayi, who formally opened the SAPP meeting, indicated that there was currently a 900 MW surplus across the region. She said efforts should, thus, be intensified to ensure that this surplus could be shared in the interest of economic growth and accelerated industrialisation.
Kubayi lauded the advances SAPP had made in creating a competitive trading platform, which now included a day-ahead market, as well as an intra-day market. She said the more competitive marketplace for electricity would be important for attracting investors into the sector.
However, greater cooperation in system planning, together with regional interconnector projects, would be key to improving security of supply and increasing electricity access. At present, about 45% of the region’s citizens had accesses to modern electricity services.
Nine of SAPP’s 16 members were currently active in either buying or selling power through the SAPP platform and acting CEO Alison Chikova said priority was being given to projects that could more fully integrate all 16 member States into the trading platform.