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PPA standoff risks future wind energy jobs as new graduates enter saturated market

17th February 2017

By: Natasha Odendaal

Creamer Media Senior Deputy Editor

     

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South Africa’s fledgling wind turbine service technician training programme will be “training its graduates for unemployment” if construction on the next round of State-commissioned wind farms does not get under way this year, warns South African Renewable Energy Technology Centre (Saretec) director Naim Rassool.

With the wind sector’s domestic job market set to become saturated, the industry is “anxious” that continued delays by State-owned power utility Eskom to sign power purchase agreements (PPAs) with selected independent power producers (IPPs) in the short to medium term will send the graduates of 2018 and beyond into unemployment.

Currently, the construction of the next batch of 26 plants, including solar and wind sites, under the Renewable Energy Independent Power Producer Procurement Programme is on hold, pending Eskom’s buy-in on PPAs.

“Until these contracts are signed, private firms cannot begin construction of the sites,” Rassool said in a statement last week.

He joins many other renewables proponents in raising a red flag on the now two-year delay in Eskom’s signing of the PPAs, with some voicing the possibility of taking the matter to the courts.

However, Eskom has defended its decision, with earlier reports by Engineering News quoting Eskom as insisting that there is an urgent need to reconsider the “pace and scale” of new renewables connections, as circumstances have changed materially in the outlook for electricity supply and South Africa is now set to experience a surplus of capacity until 2021.

Eskom reported a net economic loss of R9-billion in 2016, owing to its contracts with the existing renewables plants, and has warned that these losses will be further exaggerated should it be forced to sign additional PPAs.

However, in the interim, the impasse and the subsequent construction delays, are threatening skills development in the sector and jeopardising the future of the State-funded Saretec training facility, at the Cape Peninsula University of Technology, in Cape Town, which has started training the next round of wind turbine service technicians and the first recruits for the solar photovoltaic technicians course, said Rassool.

The State has injected R105-million in funding since 2012, with the private sector providing in excess of R30-million into the centre – a new training institution that boasts an on-site 2.5 MW wind turbine housing and associated components for training, which was supplied by manufacturer Nordex Wind Power.

Public Enterprises Minister Lynne Brown has indicated that an inter-Ministerial task team, which also comprises Finance Minister Pravin Gordhan and Energy Minister Tina Joemat-Pettersson, will meet by mid-February to find “answers” to the standoff between Eskom and the IPPs.

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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