ANALYSIS: South Africa's renewable zones plan stirs anxieties

The South African government’s Department of Environmental Affairs’ (DEA) recent announcement that Renewable Energy Development Zones (REDZ) will be introduced for wind and solar projects has been met with dismay by some developers who fear they could be left out in the cold by the changes.

The concept is that developments proposed within these areas will be ‘fast-tracked’ through South Africa’s tender scheme, the Renewable Energy Independent Power Producer’s Procurement Programme (REIPPPP).

Projects from outside the zones will still be able to enter the REIPPPP process – but face the possibility that the odds will be stacked against them.

The DEA says the incentivised areas will attract “deep” grid expansion to improve the current problems with a highly constrained network through five ‘Power Corridors’ and a streamlined regulatory processes.

Environmental pre-scoping will theoretically halve the time for authorisation in the eight zones, which have been selected following strategic environmental assessments carried out by the Council for Scientific and Industrial Research (CSIR).

Questions have been raised over the basis on which the REDZ were selected, and developers are also concerned that the numerous projects already in early development that aren’t inside the zones will now be unfairly penalised, potentially wasting significant funds already invested.

“There is a place for the REDZ in identifying high-level constraints in areas that are not suitable for development, but we don’t believe these areas should be earmarked as preferential or given priority by the REIPPPP as industry believes that many projects outside these areas would probably yield more value for money,” said Jadon Schmidt, the South African Wind Energy Association’s Environmental Working Group chair.

Although industry associations were consulted about the process of selecting the REDZ, there are complaints that their submissions were not taken into account and the areas approved regardless.

No date for implementation has been set, but the DEA is in the process of preparing the draft Gazette containing the REDZ and the protocols. Once finalised, this will be released for public comment for 30 days.

It will then be updated based on the comments received and officially published as a National Government Notice, probably up to four months from now.

While the industry waits for details of the fifth REIPPPP bidding round to be announced, sceptics fear the hold-up may be related to waiting for the REDZ to be officially implemented, leading to further expensive delays for developers and investors.

REIPPPP has been the key policy that has unlocked significant renewables growth in South Africa, which recently passed the milestone of 1GW of grid-connected wind power.