Eskom is now allowed to source over 11,800MW from Independent Power Producers (IPPs), but this will not solve South Africa’s immediate electricity problems.
This is the view of energy expert Chris Yelland, who spoke to ENCA about the Department of Energy’s new determination for the Energy Regulation Act.
The new determination, which was published last week, allows Eskom to tap renewable, gas, and coal producers to address South Africa’s growing power demands.
6,800 megawatts from renewable wind and solar sources;
3,000 megawatts from gas sources;
1,500 megawatts from coal sources; and
513 megawatts from storage.
In his weekly mail to the nation, President Cyril Ramaphosa said the procurement of power from IPPs forms part of the government’s plan to address the problem of load-shedding in South Africa.
He added that the plan also includes the procurement of renewable electricity generation and additional provision for self-generation.
While the new procurement is encouraging news, Yelland warned that this will not solve South Africa’s problems in the short term.
“This new capacity will most probably only come on stream in three to four years’ time because of the long procurement process,” he said.
He highlighted that the new capacity will still need to go out tender as part of a bidding process, followed by financial closure and construction.
Therefore, although it will address electricity shortages in the long term, this latest development will not solve load-shedding in the coming years.
In September, Eskom said it expects power constraints to persist for at least the next year, adding that load shedding may extend into 2022 depending on the pressure on the system.
Other experts, however, expect the situation to be much worse than what Eskom is predicting.
Research by the Council for Scientific and Industrial Research (CSIR) warned that South Africa should brace itself for exponential increases to load-shedding until 2022.
“Not only will load-shedding continue over the next few years – it will get significantly worse,” said Dr Jarrad Wright and Joanne Calitz of the CSIR.
Energy expert Ted Blom, in turn, said South Africa could be stuck with load-shedding until at least 2025 due to Eskom’s continued problems.
He expects load-shedding to get worse over the next year as there are still “turf wars” and corruption taking place inside Eskom, resulting in inadequate maintenance and major shortfalls in the quality of the maintenance.
The only way to stop load-shedding
Yelland previously said the only way to stop load-shedding is to replace poor-performing coal-fired power stations with reliable and low-cost wind, solar PV, battery storage, and gas-to-power generation.
“What the country needs is 6,000MW of new generation capacity in the next two to three years,” Yelland said.
“Unless South Africa launches courageous and bold decision policy initiatives, load-shedding is here to stay.
He said these policy initiatives must be aimed at replacing the old and poor performing coal-fired power stations with new generation capacity.
Yelland added that this new capacity procurement will not come from Eskom, which is why legislative and policy changes are needed.
Energy policy and investment specialist Anton Eberhard concurred with Yelland, saying alternatives to Eskom are needed to build capacity.
He said because of Eskom’s unsustainable debt levels, it has no possibility of raising new finance for new generation capacity.
“That is why we need to see alternatives. That is why we need to accelerate IPPs on a utility-scale to free up the market,” Eberhard said.
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