Calling all independent power producers

28 September 2022 News

In a broadcasted evening address on Monday 25 July, South African president Cyril Ramaphosa announced widespread changes to the existing arbitrary rules and red tape that have governed the generation of electricity. The country is currently entrenched in its worst load-shedding seen since its inception in April 2008.

In a presentation to opposition parties before his address, he stated that the country needs to “open the floodgates for private investment in new generation capacity”. He went on to add that the overriding priority is to add as much new capacity as possible to the grid in the shortest time possible.

The plan is to add 7,2 GW of capacity within three months, a further 5,7 GW within 12 months and 9,8 GW in 18 months. Therefore, if all goes to plan, we will see a total of 21,7 GW of power being added to the grid within the next year and a half, which would see the current capacity almost doubled.

Some of the major points presented which could have a major impact on the country’s generation capabilities were:

• Boosting the technical skill level at Eskom by actively targeting ex-employees and skilled workers in the private sector.

•Forming a separate body to tackle the theft and sabotage that is currently taking place at Eskom.

•Allowing Eskom to purchase excess power from private producers.

•Easing local requirements to allow renewable power projects that were awarded in fifth bid window to go ahead.

•Importing more power from neighbouring countries.

The arbitrary limit of 100 MW of private generation capacity will be scrapped and IPPs will be allowed to build power plants with unlimited capacity without requiring a licence. The announcement also stated that the amount of renewable energy it procures under the sixth bid window will be doubled to 5,2 GW.

These new measures that are set to be implemented should see an unprecedented surge in the number of private power generation projects.

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