Minerals Council South Africa says it supports the inclusion of the private sector in government's plan to resolve the country's electricity crisis.
"President Cyril Ramaphosa outlined a detailed plan by the government to abolish the 100 MW licensing cap on private sector renewable energy projects, ensure greater private sector participation to urgently install electricity generation capacity, address Eskom’s R400-billion debt and its internal crime and corruption problems, and streamline regulatory processes by eliminating red tape.
"This represents the most fundamental reforms of South Africa’s energy sector in 20 years," says Minerals Council CEO Roger Baxter.
“Overall, we rate this plan as very good for its boldness and for recognising that the private sector, along with fixing the reliability of Eskom, is the solution to energy security going forward. The Minerals Council and its members, which are already active in coming up with solutions, are ready to play their part.
“The President and Cabinet recognise that we have a fundamental energy crisis and that there can be no more tinkering around the edges. This is a comprehensive overall reform plan, with the private sector playing a critical role in ensuring South Africa’s energy security into the future. We support this bold and ambitious plan,” he emphasises.
The council notes that the mining industry already has a pipeline of 73 projects from 24 mining companies to generate 5.1 GW of electricity. The value of these projects is more than R65-billion.
So far this year, the National Energy Regulator of South Africa (Nersa) has registered 295 MW of projects for mining companies.
The council reiterates that the mining industry can play an important role in reducing the pressure on Eskom, which must undertake extensive maintenance of its fleet of aged and neglected power plants that have an average age in excess of 35 years and take old coal-fired plants out of service and repurposing them to renewable energy and battery storage solutions.
“We acknowledge the President’s focus on addressing the crime and security challenges facing Eskom,” adds Baxter.
He notes that the regulatory processes that took up to three years to approve renewable energy projects delayed the private sector’s ability to relieve the energy crisis, but that the President's commitment to cut red tape, develop a “one-stop shop” for renewable energy project applicants, ease the local procurement rules and bring a level of pragmatism to the environmental authorisations, are important developments that must be implemented with urgency.
The council has also expressed support for the establishment of a National Energy Crisis Committee, comprising key ministries and entities involved in the provision of electricity, and chaired by the director-general in the Presidency.
"We recommend the right experts are consulted, including those from the Minerals Council, the Energy Intensive Users Group and Business Unity South Africa," it states.