nuclear-news

Eskom has justified its recent announcement not to sign further power purchase agreements with independent power producers with reasons that range from questions about the need for additional renewables and baseload IPPs, to improved operating performance, its large-scale new build programme, and protecting consumers from higher prices by not buying additional capacity.

Yet, the renewable energy programme is regarded as highly successful, and it delivers a wide range of benefits at the best prices given that it is a buyer’s market.

Eskom’s own 2016 financial report states that wind and solar are now cheaper than coal-generated electricity. The Treasury has stated that 92 renewable energy programme projects have attracted R193bn in private sector investment, totalling a contribution of 6,327 MW of capacity to the national grid. The total projected value of goods and services to be procured from broad-based black economic empowerment suppliers is put at more than R101bn.

Investment in renewables accounted for 85.8% of total direct foreign investment in SA in 2014. A Council for Scientific and Industrial Research report revealed that wind energy produced net savings of R1.8bn in the first half of 2015 and was also cash positive for Eskom by R300m.

The net savings can be attributed to avoiding diesel and coal fuel costs, as well as the economic costs of load shedding. Renewable energy in total generated a net benefit for the economy of up to R4bn. Renewable energy production has cut 4.4m tonnes of carbon dioxide.

At a policy level, the government has indicated that renewable energy has to be ramped up. The country’s energy vision and the National Development Plan call for a greater mix of energy sources and a greater diversity of IPPs in the energy industry, with the 2010 Integrated Resource Plan’s vision calling for 17,800 MW of renewable energy to be in place by 2030.

Internationally, SA is a signatory to the Intergovernmental Panel on Climate Change (IPCC) global climate change agreement to keep planet emissions beneath 1.5°C by honouring carbon emissions reduction targets.

Legally speaking, Eskom is a buyer of electricity, with the Department of Energy procuring capacity in line with ministerial determinations. The government’s commitment has been laudable. It is worrying that Eskom seems to wish to erode this………..