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ENERGY
Golden Valley Wind Energy Farm.
ENERGY LIBERALISATION
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to raise SA’s energy availability levels
Having exceeded 150 days of loadshedding in 2022, South Africa’s economy continues to feel the strain of the energy availability factor, which is not able to reach the required levels. SAWEA acknowledges that while the problem is simple, developing solutions for the energy crisis is complex and requires the right expertise for planning.
BY SAWEA
At the heart of the plan, the South African Wind Energy Association (SAWEA) is advocating for “Energy Liberalisation” underpinned by several mechanisms. Specifically Demand Side Management where new generation capacity for own use, must be considered as a mechanism to reduce demand and increase supply.
“We believe that while the Electricity Regulation Act amendment bill is the right policy intervention to support a liberalised energy market in South Africa, Niveshen the removal of the license requirement Govender for own use projects will not have the desired outcomes if not implemented efficiently and effectively,” explains Niveshen Govender, CEO of SAWEA.
He adds, “Policy alone is not enough, we must manage and improve the bureaucracy of the process required to build new generation and renewable energy capacities specifically.”
The Association believes that there needs to be more and better coordination between stakeholders and that political will and regulatory frameworks should be forthcoming. The industry is calling for a clear, transparent and documented process to guide a number of blockages to delivering new generation.
“Our industry needs grid connection application, and wheeling conditions need to be standardised and finalised nationwide; as well as permitting requirements and processes that are accessible and practical,” says Govender.
Acknowledging that energy solutions will largely be funded privately, typical investor conditions should be encouraged to create investor confidence.
Private Power Purchase Agreements are new territory for South African IPPs and at this point still represent a fairly high risk for the producers, with contention around risk allocation between parties.
“Once we have the first few projects over the line, the industry will be able to iron out several issues at play, but as it stands the industry needs to unpack a number of requirements for the private off-take market to achieve bankability,” concludes Govender.
