Oct 22, 2012
Financial closure on renewable projects needed to maintain investor confidence – SAWEABack
Cape Town|Environment|Power|PROJECT|Projects|Renewable Energy|Renewable-Energy|Windaba|Electricity Generation Capacity|Energy|Manufacturing|Prospective Independent Power Producers|Wind Energy|Wind Energy Sector|Jasandra Nyker|Johan Van Den Berg
“The programme is nothing short of impressive. But to really show that this programme works and to maintain investor confidence, financial close needs to occur to acquire confirmation that we indeed have a wind industry,” SAWEA chairperson Jasandra Nyker said during the opening session of the conference.
Reflecting on the past year in the South African wind energy sector, Nyker was positive about the progress the industry had made with eight wind projects having been selected out of the total of 28 projects under round one of the REIPPP, totalling 634 MW, and another seven wind projects being successful in round two, accounting for 563 MW. “For any first-time industry that is an impressive accomplishment and we should not blindly cast that achievement aside,” she said.
However, as with any new programme there was always room for improvement, said Nyker, adding that government had to engage further with industry to ensure that the “very expensive learnings of round one” were taken into consideration as the REIPPP moved into future rounds. “Ask any round-one developer, the process to financial close has to be done in a more cost-effective manner going forward,” she asserted.
Nyker added that the wind industry welcomed the government’s announcement that there would be further allocation of future electricity generation capacity for renewable energy. “The 1 470 MW allocated to wind energy ensures that wind will become the dominant player in the renewable-energy mix in the years to come.”
The theme of the localisation requirements for the REIPPP would also be highlighted at the 2012 Windaba conference and Nyker warned that the government needed to give the long-term implications of the policy serious thought. “The [capital expenditure] associated with constructing local manufacturing plants is significant and it is going to require a much longer-term view and a further megawatt commitment to wind to ensure that these manufacturing plants will be stable. Given the current global and local economic environment we cannot afford to invest in manufacturing facilities that will end up underutilised or loss making in the future,” she said.
“In this modern-day world of tighter operating margins and a theme of downsizing globally, the ‘just do it’ approach needs to be given much further thought and evaluation. Like many of us sitting here in this hall today, we want to build a localised industry that can stand on its own and indeed create that manufacturing gateway to the rest of the SADC [Southern African Development Community] region,” said Nyker.
The first REIPPP round required 25% local content for wind projects, which, according to SAWEA CEO Johan van den Berg was not overly onerous as it could be covered in the ‘balance of plant’ portion of the project costs. Even with the third round requiring 40% local content, Van den Berg said he thought this was still possible, though it would require South African blade and turbine contributions. “As we go further up it becomes a little bit more challenging but it’s not that it can’t be done, it’s the question of whether it can be done,” he said.
Edited by: Creamer Media Reporter
To subscribe email email@example.com or click here
To advertise email firstname.lastname@example.org or click here
Other Electricity News
Significant energy savings can be achieved by replacing existing oversized air compressors with correctly sized units that use power more efficiently, says compressed air products distributor Goscor.
Recent Research Reports
Automotive 2016: A review of South Africa's automotive sector (PDF Report)
Creamer Media’s Automotive 2016 Report provides an overview of South Africa’s automotive industry over the past 12 months. The report provides insight into local demand and production, vehicle imports and exports, investment and competitiveness in the sector, as well...
Energy Roundup – April 2016 (PDF Report)
The April 2016 roundup covers activities across South Africa for March 2016 and includes details of a North Gauteng High Court Judge’s dismissal of a court application to postpone the 9.4% electricity tariff increase, which the National Energy Regulator of South...
Electricity 2016: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2016 report provides an overview of South Africa’s electricity sector, focusing on State-owned power utility Eskom and independent power producers, electricity planning, transmission, distribution and the theft thereof, besides other issues.
Energy Roundup – March 2016 (PDF Report)
The March 2016 roundup covers activities across South Africa for February 2016 and includes details of the Department of Energy’s plans to announce the preferred bidders for the first tranche of the coal independent power producer procurement programme; the Council...
Steel 2016: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2016 Report examines South Africa’s steel industry over the past 12 months. The report provides insight into the global steel market and and particularly into South South Africa’s steel sector, including production and consumption, main...
Construction 2016: A review of South Africa's construction industry (PDF Report)
Creamer Media’s Construction 2016 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; key participants; local demand; geographic diversification; corporate activity; black economic...
This Week's Magazine
The two spent-fuel pools at Eskom’s 1 800 MW Koeberg nuclear power station, in the Western Cape, will be full by 2018, increasing the urgency on the State-owned utility to begin pursuing alternative storage options. Koeberg has, over the past 32 years, accumulated a...
South Africa lacks the skills necessary to implement the government’s plan to build 9.6 GWe of new nuclear energy capacity, warns nuclear-qualified Quality Strategies International CEO David Crawford. “Apart from the concern about the affordability of the programme,...
Cybersecurity multinational Check Point has released its latest 700-series cybersecurity systems for small businesses, which draw on its international threat intelligence to provide up-to-date cybersecurity, says Check Point South Africa country manager Doros...
Daimler Trucks and Buses Southern Africa (DTBSA) saw a marked slip in new-vehicle sales in 2015 compared with 2014, with sales dropping from 5 897 units to 5 300 units. The decline came as the South African new truck and bus market declined from 31 558 units in 2014...
Group of 20 (G-20) economies threatened to penalise havens that don’t share information on their banking clients after the leak of the Panama Papers provoked a global uproar over tax evasion. The G-20 will consider “defensive measures” against financial centers and...