The South African Renewable Energy Council (Sarec) said the Department of Energy (DoE) and Eskom had failed to provide any certainty for renewables investors when reporting to Parliament, on Tuesday.
An intergovernmental task team, comprising representatives of the DoE, the Independent Power Producer (IPP) Office, Eskom and the Department of Public Enterprises, had been established to find solutions to the impasse that halted the signing of power purchase agreements (PPAs) for 37 renewable energy projects,
Sarec on Wednesday said that rather than offering solutions to the impasse, the task team had proposed further delays in finding a resolution to the end of August.
Sarec believes this could be further delayed to February 2018.
“These delays will have direct negative consequences for our renewables industry. Growing numbers of companies, employees, graduates and communities are suffering the consequences of the R58-billion stalled investment, 13 000 lost construction jobs and billions of rands of local economic development spend foregone,” the council said in a statement.
It highlighted that before the renewables programme ground to a halt in 2015, it was trumpeted as a resounding success by both government and Eskom, with bid tariffs also decreasing to such an extent that renewable energy became the cheapest option for new generation capacity available to the country.
Sarec chairperson Brenda Martin said it was worrying that Eskom’s apparent objections to signing agreements with preferred renewable bidders ignored the industry’s broad benefits, which includes a substantial ecosystem of service industries, leveraging investment in heavy upstream fabrication industries.
“Instead, it focuses on its selfish interests. This from an entity that, over the past decade, has managed to stall economic growth through load-shedding, waste tens of billions of rands on its new-build programme, yet further billions of rands on nontransparent coal procurement and, to top it all, quadrupled its retail tariffs,” Martin averred.
By comparison, the renewables industry has met and generally exceeded all policy objectives set by government, including employment targets, by 27%.
More than 98% of renewables projects have been delivered on time and any cost overruns have been for the account of investors’ rather than consumers.
“Should government wish to increase any of these economic development targets in future rounds, the renewable energy industry would welcome a discussion. However, it is clearly not feasible to shift the goal posts for bidding consortia that have already been awarded permits on the basis of the current bid rules.
“We call on the government to hold Eskom and the task team to account for the commitments made in Parliament today, namely for final recommendations to be delivered to Ministers by the end of June, and for all outstanding ‘interventions’ to be dealt with by August. Investors are watching this space with deep concern,” said Martin.