It is essential that the country’s sources of electricity be diversified to ensure occurrences of load-shedding, as experienced particularly badly last week, stop happening, business organisation Business Leadership South Africa (BLSA) CEO Busi Mavuso emphasises in her weekly newsletter.
“We cannot rely on a single State utility any longer. We have known this for some time and had we acted more vigorously sooner, experiences like last week could have been avoided.
“We have the right ingredients – the private sector can now build plants of up to 100 MW without a licence. The renewable energy independent power producers (IPPs) programme can procure far larger power production. Within a matter of years, we could substantially diversify the producers of electricity in South Africa,” Mavuso posited.
She stated that while progress had been made in this regard, it had been too slow.
She highlighted one particular good intervention as the decision of State-owned utility Eskom to make available the considerable amount of land it owns in Mpumalanga to IPPs.
Much of this land already had the regulatory approvals needed to produce electricity and was close to grid connection points, Mavuso pointed out.
She outlined that, a fortnight ago, Eskom CEO André De Ruyter announced the first 18 successful bidders for leases on this land. These would each put up 100 MW plants, adding 1.8 GW in capacity.
Mavuso said that because only 11% of the 36 000 ha available would be used by those first tenants, there was much more potential.
Mavuso mentioned that there was also an acceleration in other private producers registering new power plants with the National Electricity Regulator of South Africa.
She pointed out that the regulator had, so far, approved 18 projects under the so-called 100 MW reform, with the last approvals done in 19 days from receipt of the application.
“That is a positive sign that red tape has been removed from the process of private generation,” acclaimed Mavuso.
“There is [however] still a way to go to a vibrant energy future. Eskom must complete the unbundling of a separate system operator, one that will be able to buy electricity for the grid from the cheapest sources, only one of which will be Eskom.
“We need to put in place clear regulations and processes to facilitate wheeling through the grid – the process by which an electricity producer in one location can sell to customers in other locations through the grid. These additional steps will accelerate the rate at which private producers will enter the market,” Mavuso stated.