WIND POWER GAINS GROUND
The South African Wind Energy Association (SAWEA) has applauded the South African government for the massive progress made in policy over the last 12-months, beginning with the gazetted 2019 Integrated Resource Plan (IRP) and all the very hard work done, despite the COVID-19 pandemic, to ensure its commitment to the stabilisation of future growth of the renewable power sector.
“We started the year with a firm commitment from President Cyril Ramaphosa during his SONA, to take measures to rapidly and significantly increase generation capacity outside of Eskom in order address the energy crisis, which prefaced a number of Ministerial Determinations and other clear statements of support for the sector,” said Ntombifuthi Ntuli, CEO of SAWEA.
Two Section 34 Determinations were issued this year, one for the procurement of emergency power and other for the procurement of power from different technologies as outlined in the 2019 IRP. The Risk Mitigation Independent Power Producers Procurement Programme Request for Proposals was issued in August, procuring emergency power from various technologies.
The industry has noted the gazetting of regulations allowing municipalities in good financial standing to procure their own power from Independent Power Producers (IPPs). Another progress witnessed is the recent announcement by the National Energy Regulator of South Africa (NERSA) that the Minister of Mineral Resources and Energy has approved that they may process licence applications for self-generation facilities of projects above 1MW, even if they are not in compliance with the 2019 IRP.
In June, the Department of Mineral Resources and Energy (DMRE) announced in parliament that it intended entering into agreements with existing renewables IPPs to procure 128 MW of additional energy that wind and solar farms could supply over and above what is currently allowed under their existing Power Purchase Agreements, which has not yet materialised.
More recently, during a debate on the country’s economic recovery plan, the DMRE Minister, Gwede Mantashe, confirmed that Bid Window 5 of the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP) would be issued in December 2020.
Alongside all this policy progress, in July, Minister Mantashe agreed to the creation of the Renewable Energy Engagement Forum, to support regular engagement between the renewable energy sector and the DMRE, thereby cementing a way to forge a more positive relationship, based on trust and improved communications.
Further evidence of positive change comes from Public Enterprises Minister, Hon. Pravin Gordhan’s recent keynote address on governments’ intent and commitment to implement an Independent Transmission Grid System and Market Operator (ITSMO) in South Africa.
Eskom’s CEO, Andre De Ruyter, has also affirmed the role of renewable energy, naming that the technology’s place in Eskom’s portfolio is imperative as it can bring capacity into the grid faster, reliably and cost effectively in order to close the capacity gap that will be created by the decommissioning of 10 000 MW of coal over the next decade. He further alluded to the availability of ‘Green Financing’ as a vehicle for investment and specifically to draw finance to the decarbonisation of the country’s national grid, in order to make an ITSMO a reality.
In anticipation of the 2019 IRP kick-starting with a new procurement round, namely Bid Window 5, the wind sector has already developed several projects and achieved all the necessary authorisations. This means that the sector is ready to deliver on the allocated annual capacity of 1600 MW to wind power which, in line with the power plan, makes up a total of 14.4 GW over the next ten years.
The sector is currently completing the connection of new Bid Window 4 wind farms to the country’s grid, with a total of 1.3 GW of new wind power capacity, coming on stream as part of this procurement round. The first of these to reach Commercial Operations Date, is the 110MW Perdekraal East Wind Farm, in the Western Cape. 32 MW Excelsior Wind, 140 MW Kangnas Wind Farm and 139 MW Nxuba Wind Farm, are all expected to reach this milestone by end-2020. The additional eight power generators, will be completed during 2021.
With supporting policy and smooth procurement rounds, the renewable power sector certainly has a key role to play in re-building the country, as a significant catalyst of economic growth. We are therefore encouraged that our sector is being recognised for its delivery of clean power that is affordable. Additionally, clean technology is seen to be offering hope for our country to meet energy demand on a localised level and even fulfil our international obligation to decarbonise our power sector.