Energy News

South Africa’s Green Energy Surge: Tackling Crisis with 14,771 MW Renewables Boost

Published by
WIlliam Dube
  1. The South African government, in collaboration with Nersa, has announced plans to generate 14,771 MW from renewable energy and energy storage sources by 2030 in order to alleviate the ongoing energy crisis.
  2. Despite the government’s commitment, challenges such as inadequate grid infrastructure and the need for additional battery storage for renewables to reliably meet peak power demands pose obstacles to implementing renewable energy projects.
  3. The government has introduced legislative frameworks and exemptions to stimulate private power generation and expedite the adoption of renewable energy sources, as public outcry over load shedding reaches a tipping point.

In an effort to alleviate the ongoing energy crisis in South Africa, the Minister of Mineral Resources and Energy, in collaboration with the National Energy Regulator (Nersa), has announced a significant increase in renewable energy generation capacity. A government gazette published on Thursday, 6 April, specified that 14,771 megawatts (MW) should be generated from renewable energy and energy storage sources by 2030.

This ambitious plan includes the following breakdown of energy sources:

  • Solar PV – 3,940 MW
  • Wind – 9,600 MW
  • Energy storage – 1,231 MW

These targets form part of the government’s broader strategy to supplement the nation’s energy supply with renewable sources between 2024 and 2030, as detailed in the Integrated Resource Plan for Electricity 2019-2030 (IRP 2019).

Eskom, South Africa’s primary electricity supplier, is urged to procure large quantities of renewable power from independent power producers (IPPs). The IRP 2019 serves as a technical blueprint for the country’s electricity infrastructure development plan.

The increase in renewable energy generation capacity comes as South Africans continue to grapple with persistent rolling blackouts, negatively impacting daily life and business operations. Electricity generated from the new capacity will be procured through transparent, competitive, and cost-effective tendering processes under the Independent Power Producers procurement programs, according to the Department of Mineral Resources and Energy.

The department’s procurement initiatives aim to facilitate connections to the national grid as soon as reasonably possible, adhering to the prescribed timeline. Deviations from this timeline are only permitted if they are essential for efficient procurement and construction of new generation capacity.

Despite the government’s commitment to renewable energy, several obstacles have emerged on the ground. The sixth round of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP Bid Window 6) called for new generation capacity of 4,200 MW, consisting of 3,200 MW of wind energy resources and 1,000 MW of solar photovoltaic energy resources. While the solar component was filled by the end of March 2023, the wind component was not met due to a lack of room on the national grid for the proposed projects. To fulfill the wind energy requirements, significant investments in grid infrastructure are necessary.

New electricity minister Kgosientsho Ramokgopa acknowledged another challenge with renewables: without additional infrastructure such as battery storage, they cannot reliably contribute to the country’s base load or meet peak power supply demands. Ramokgopa noted that South Africa experiences peak demand in the mornings (05:30-08:00) and evenings (18:00-20:00), while renewables generate peak energy production between 08:30 and 16:30.

The push towards renewable energy has been underway for years, but in 2023, public outcry over load shedding reached a tipping point. The government was ultimately compelled to create legislative frameworks for private power generation on personal and commercial levels.

To expedite the adoption of new generation sources, the Department of Trade, Industry, and Competition (DTIC) published draft clock exemptions for energy suppliers and users on 9 March. Ebrahim Patel, Minister of DTIC, stated that the new regulations would exempt certain agreements and business practices by energy suppliers and users to stimulate new energy generation. Exemptions encompass agreements related to joint procurement of alternative energy supply for the national grid, financing alternative supplies, and various procurement practices.

Although these exemptions were introduced under the national state of disaster, which was terminated recently, Ramokgopa assured they would remain in effect, bolstering South Africa’s transition towards renewable energy sources.

WIlliam Dube

William Dube is a finance and economic news expert with over 10 years of experience in economic anaylsis, financial product assessment and market analysis. With a numerous certificates from prestigious universities including but not limited to Yale University and the University of Pennyslivenia. William specializes in providing insightful news developments in South Africa and commentary on investment strategies, risk management, and global economic trends. You can contact him on william@rateweb.co.za

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Published by
WIlliam Dube

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