South Africa has launched a new power programme to build new power plants, consisting mainly of renewable energy, to supplement the country’s energy mix. With a combined capacity of 11,813 MW, the power stations will mainly consist of wind and solar power which will be built from 2022.
The National Energy Regulator of South Africa (NERSA) approval of the Ministry of Energy decision to engage private producers in installing additional power stations, will help ESKOM reinforce national electricity power.
NERSA’s approval of the procurement of 11813MW new generation capacity, will open up various Bid Windows (BW) including BW 5 of renewable energy.
According to South Africa’s Mineral Resources and Energy Minister, Gwede Mantashe, the approval will enable the department to undertake procurement of additional electricity capacity in line with the Integrated Resource Plan (IRP) 2019.
The implementation of the programme is part of South Africa’s integrated plan for electrical resources, which is the national energy program for the next ten years.
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The capacity to be built, 6,800 MW of power to be generated from renewable energy sources consisting of solar and wind, 3,000 MW to be generated from the gas-fired power plants, 1,500 MW coal plants and 513 MW will be generated from storage capacities.
Minister Gwede confirmed that various stakeholders have so far been engaged to put in place the essential framework for the banking feasibility of the program.
Eskom has always been the acquirer of the capacities put in place in government programs. However, the last phase of acquisition of renewable energy plants by private producers was suspended in 2016 when the company unilaterally refused to sign the power purchase contracts, arguing a production surplus. A blockage that lasted until 2018 when the contracts for the 27 projects were finally signed. However, this incident has shaken investor confidence in the South African energy market, mainly for the renewable sub-sector.
The company returned to serial power cuts last year, due to the chronic failures of its old and poorly maintained coal-fired power plants. This recently led it to launch a risk limitation program which will allow the emergency installation of 2,000 MW of capacity by next year.
