ANALYSIS: South African renewables fight back after Eskom slight

Eskom CEO Brian Molefe sparked anger and confusion in South Africa’s renewables sector by claiming that renewable energy projects have “failed” to provide the state utility with the support it needs during times of peak energy demand.

Renewable energy trade associations and environmental group Greenpeace have been quick to respond, questioning Molefe’s assertions and providing an abundance of statistical evidence showing that the industry is, in fact, performing even better than predicted over a range of measures.

A report from the Council for Scientific and Industrial Research (CSIR) showed that wind and solar power created diesel savings of 3.7bn rand and 3.5bn rand ($233m and $220m) respectively during the first half of last year. Their contribution towards reducing load-shedding was calculated as being a net saving to the economy of 4.8bn rand.

Wind energy in the same period was cash positive for Eskom, saving it 300m rand in fuel costs.

Molefe’s comments came in the same week that energy minister Tina Joemat-Pettersson hailed the government’s Renewable Energy Independent Power Producer’s Procurement Programme (REIPPPP) a global success, highlighting the many benefits that wind and solar projects have brought to South Africa already – along with a reminder of the scope of the remaining programme.

The REIPPPP is a competitive bidding process where developers submit their projects under ‘bid windows’ to be assessed under set criteria. There have been four of these windows completed so far, with another expedited window of 1.8GW currently under adjudication.

In four years, South Africa has gone from hosting negligible wind and solar generation capacity to having procured 6.4GW of renewable energy, with 13.2GW pledged by 2025.

Joemat-Pettersson also shared latest figures showing that the contribution to the electricity grid from renewable energy developments now in full operation has reached 16% of total energy produced in the peak periods of morning and evening in any 24-hour period.

This share of available energy will continue to increase as more diverse renewable sources hit the grid, including biomass and concentrated solar power, which provides energy storage.

A recent EY report placed South Africa as the eleventh most attractive country for investment in renewable energy. This is validated by further statistics from the Budget speech which show that there has been 200bn rand of private investment in solar and wind developments so far in South Africa, with another 55bn rand expected with the REIPPPP’s expedited bid window.

In a country with 25% unemployment, the renewables programme has also brought thousands of ‘green’ jobs. Developers had committed to delivering 8,451 jobs during the construction phases of bid windows one to four, but actual figures stand 70% higher at 14,334 new jobs. The majority of these jobs are in rural provinces where unemployment is highest.

In a damning response to Molefe’s comments, Greenpeace said renewable energy is the “only technology currently delivering new electricity capacity on time and on budget to South Africa’s constrained grid”.

This is in contrast to Eskom’s new-build coal power stations which have been beleaguered with long delays and overspent budgets. Latest wind energy prices are now almost 50% lower than those predicted for Eskom’s new coal plants.

Eskom has made a half-hearted effort to pacify the industry in the last few days, claiming that it is committed to the REIPPPP programme and highlighting its own investment in renewable energy.

But it is hard to understand the motivation behind Molefe’s comments – particularly when contrasted with the statistical evidence demonstrating the ongoing success of renewable energy in South Africa.