Uncertainty in SA’s renewable energy policy is holding back investment vital to ensure system reliability and capacity, says an industry leader.
The newly appointed CEO of South African Wind Energy Association (SAWEA), Ntombifuthi Ntuli, says the country’s poorly drafted Integrated Resource Plan (IRP) is riddled with ambiguities, and has not been adopted on three attempts, inevitably leading to uncertainty.
Last year August, then energy minister Jeff Radebe published for comment the long-awaited draft IRP 2018, a 20-year energy roadmap to meet SA's future power needs.
Ntuli’s sharp criticism of government policy comes as industry experts say an up-to-date IRP for electricity is essential for the country’s overall economic and energy planning process for the provision of adequate electricity generation capacity to meet demand for the next 20 to 40 years.
“We are in policy limbo at this stage; we are waiting for the IRP and the fact that we have waited for so long doesn’t make me happy. We had the IRP 2013 draft that was never approved; we then had the 2016 IRP draft also never approved; and this was followed by the 2018 draft that was never approved,” Ntuli explains.
She adds: “We now have the 2019 draft and we are waiting with bated breath [to see] if it’s going to be approved. That, on its own, gives uncertainty in the industry. People want to make investments, but you can’t make them if there is uncertainty.”
Energy mix
In 2018, government had envisaged that by 2030, SA’s energy mix would consist of 34 000MW of coal, representing 46% of installed capacity; 11 930MW of gas, or 16% of installed capacity; 11 442MW of wind, or 15% of installed capacity; 7 958MW of photovoltaic (PV or solar); and 4 696MW of hydropower, or 6% of installed capacity, but the plans have yet to be confirmed.
Adding to the policy drama is the recent removal of Karen Breytenbach as head of the country’s Independent Power Producer (IPP) Office, which was criticised by politicians as well as industry.
Despite the policy conundrum, Ntuli says apart from policy, there is strong lobbying against renewable energy that has exacerbated hiccups in the sector.
She is, however, optimistic that from her engagement with some in the industry, including the IPP Office, there is hope for the future.
Ntuli says: “The public officials are hearing a lot of voices, including ours, and we know there is strong opposition towards the move to renewable energy. There is a very strong lobby against renewable energy and everyone is lobbying the same office.”
She adds: “We hear a lot of people in public talking about the negative stuff; maybe we need to start doing more, educating the public on renewable energy.”
Ntuli says she has yet to meet with the Department of Energy as well as the Department of Trade and Industry in her engagements.
She tells ITWeb she is also in support of the document: “Economic Transformation, Inclusive Growth and Competitiveness: Towards an Economic Strategy for South Africa” that was published by National Treasury.
Finance minister Tito Mboweni has asked the public to submit comments on the document by 15 September.
The document, among other things, calls for the modernisation of network industries such as energy, transport and telecommunications to make them more competitive.
The paper argues that debt-laden power utility Eskom should consider selling coal-fired power stations to raise R450 billion.
"Restructuring the electricity sector will limit the fiscal and economic risk that Eskom poses and support economic transformation through more entrants into the electricity space,” states the paper. “Consideration should be given to regulations and legislation to enable households and firms to sell the excess electricity they generate through rooftop solar PV systems.”
Ntuli says: “I hope the proposals by the Treasury will be adopted.”
She notes: “South Africa is going through a crisis in terms of electricity provision. We have power stations that are nearing end of life and will be closed soon because they are no longer efficient, and that means capacity lost must be replaced.
“It needs to be replaced by clean, affordable power that can get on as soon as possible. I don’t see any contender other than solar and wind energy.”
Seasoned leader
Ntuli has extensive experience in the sector.
Before taking over the reins at SAWEA, she worked for the CSIR as a research group leader: energy industry, where she focused on assessing the economic impacts of the energy sector transition, including jobs, SME development, industrialisation as well as socio-economic development.
Among other issues, Ntuli says the renewable energy sector not only offers business opportunities to local companies, it also incentivises the industry to identify emerging entrepreneurs, especially in rural areas, and assist them to achieve high performance goals.
“There are opportunities throughout the value chain for both technical and non-technical services,” she says.
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