The South African Independent Power Producer Association (SAIPPA) has welcomed Energy Minister Jeff Radebe’s statement regarding the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).

During a briefing on Sunday, the Minister discussed the context and chronology of events that led to the inclusion of independent power producers (IPPs) and of renewable energy in the South African energy mix.

SAIPPA said it was clear from the statement that government and its alliance partners had followed an inclusive process of consultation before adopting the White Paper on Renewable Energy in 2003.

“While finalising the Integrated Resource Plan (IRP) 2010, social partners were consulted on all matters relating to the REIPPPP.

“This inclusive process was also followed with the inclusion of social partners through the National Economic Development and Labour Council, before the IRP was promulgated on May 6, 2011," SAIPPA continued.

Similarly, it said, the Green Economy Accord was negotiated with all parties involved and signed in November 2011 in Parliament. Present when signed, and also consulted beforehand, were 12 Cabinet Ministers; some of South Africa’s largest companies; small and medium-sized enterprises from the Green Energy Associations; all three labour federations, namely the Congress of South African Trade Unions, the Federation of Unions of South Africa and the National Council of Trade Unions; and community representatives drawn from the youth, women, cooperatives and civic formations.

SAIPPA reiterated the statement by the Minister that the renewable energy IPPs are cost neutral to Eskom.

SAIPPA concurred that the assertion that Eskom incurs losses as a result of the REIPPPP is without foundation, misleading and false. 

Since 2013, Eskom has not incurred a cent in buying electricity from IPPs which it has not been able to recover through the tariff allowed, said the association.

Further, SAIPPA supported Radebe’s view that Eskom’s actions, since 2015, in refusing to sign power purchase agreements for further renewable energy projects, had resulted in manufacturing capacity of goods and services in the value chain closing down. This created a negative investment environment and contradicted government policy – which was corrected in 2018.

SAIPPA was thankful towards the new political leadership, who have brought change that will lead to market stability and much needed investment.

 Moreover, SAIPPA called on Radebe to publish the latest IRP update during March as promised, and to make determinations regarding the procurement of more electricity from IPPs early in 2019 and procure electricity from IPPs during the latter part of 2019. "This will ensure South Africa expands its electricity generation fleet to minimise load shedding and the related negative impacts on investment and growth.”

 SAIPPA also called on the Minister, government, Eskom, the labour federations and all South Africans to engage in good faith to chart a way forward in the timely, planned decommissioning of the old Eskom coal-fired power stations so that more jobs can be created as a result of a just transition to a green energy future.