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- The Department of Mineral Resources and Energy will soon announce successful bids for 2,000 megawatts of emergency power, said President Cyril Ramaphosa.
- In December 2020, the government and its social partners signed the Eskom Social Pact.
- It describes the actions necessary to meet the country’s energy needs now and in the future.
Restoring Eskom to operational and financial health and accelerating its restructuring process is central to South Africa’s economic recovery plan, President Cyril Ramaphosa said during his State of the Nation (SONA) address on Thursday.
“Eskom has been restructured into three separate entities for generation, transmission and distribution. This will lay the foundations for an efficient, modern and competitive energy system,” he said.
He said Eskom was making substantial progress with its intensive maintenance and operational excellence programs to improve the reliability of its coal fleet.
“We are working closely with Eskom on proposals to improve its financial position, manage its debt and reduce its dependence on the fiscus. This requires a review of the rate route to ensure that it reflects all reasonable costs and measures to resolve the debt problem.” Ramaphosa said.
In December 2020, the government and its social partners signed the Eskom Social Pact, which outlines the actions required to meet the country’s energy needs now and in the future.
Over the past year, there have been attempts “to urgently and substantially increase” generation capacity in addition to that generated by Eskom, according to Ramaphosa. He said the Department of Mineral Resources and Energy will soon announce successful tenders for 2,000 megawatts of emergency power.
Independent power producers
Additionally, Ramaphosa said necessary regulations have been amended and requirements for municipalities to purchase energy from independent power producers clarified. Systems are being implemented to support qualified municipalities.
“The government will soon begin acquiring an additional 11,800 megawatts of energy from renewable energy, natural gas, battery storage and coal in accordance with the 2019 Integrated Resource Plan.
“Despite this work, Eskom estimates that without additional capacity, there will be an electricity supply deficit of between 4,000 and 6,000 megawatts over the next five years, as old coal-fired power plants reach the end of their lives. As part of the measures to address this shortfall, in the coming weeks we will issue a request for proposals for 2,600 megawatts of wind and solar energy as part of Bid Window 5, “he said.
This will be followed by another bid window in August 2021.
He said a recent analysis suggests that easing licensing requirements for new integrated generation projects could unlock up to 5,000 megawatts of additional capacity and help alleviate the impact of reduced load.
“Therefore, we will amend Annex 2 of the Electricity Regulation Law in the next three months to increase the licensing threshold for integrated generation. This will include consultations among key stakeholders on the level at which it should be set. the new threshold and completion of the necessary requirements. enabling frameworks, “Ramaphosa said.
“Eskom has already started working to accelerate its business and technical processes to enable this additional capacity on the network without undue delay.”
Environment
Ramaphosa added that the country cannot lose sight of the threat that climate change poses to our environmental health, socio-economic development and economic growth. Therefore, in line with the commitments assumed by SA under the United Nations Framework Convention on Climate Change and its Paris Agreement, Eskom, the largest emitter of greenhouse gases in the country, has committed in principle to zero net emission by 2050 and to increase its renewable capacity.
“Eskom will seek to partner with investors to reuse and replenish part of its coal fleet. This will be done in a way that encourages investment, local economic activity and local manufacturing, as part of a just transition,” Ramaphosa said.
