Minerals and Energy Minister Gwede Manatashe unveiled details of the 25 projects from the fifth window of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) late on Thursday. He also made bizarre remarks about load shedding which suggest he is in the dark on the issue.
To wit, the projects will produce 1,608MW from onshore wind and 975MW from solar photovoltaic plants and the total investment is expected to reach about R50-billion. Almost 14,000 jobs are expected to be created, just over half during the construction phase. South African citizen will have 72% of the jobs, while the expat workers will be subjected to the horrors of the shambolic mess that is the Department of Home Affairs, where the sun never shines.
None of the projects will be generating power before April of 2024 and so will do nothing to address South Africa’s immediate power crisis which was underlined this week by stage 4 load shedding.
The projects are 49.2% South African owned and the DMRE said in a statement that: “The majority of the equity owned by South Africans has been taken up by black people. On average, black South Africans own 34.7% of the equity across the different projects, while the minimum threshold was 30%.”
“In an effort to stimulate local manufacturing and production in the renewable energy value chain, the RFP required projects to commit at least 40% local content during construction. This local content target can be achieved by purchasing local goods across the renewable energy value chain. On average, the 25 Preferred Bidders committed about 44% local spend during construction as a percentage of Total Project Value,” it said. The project owners were not named.
So all the right boxes have been ticked. The appointed bidders will reach commercial close in about four months’ time.
The projects are mostly in the Western Cape, Northern Cape and Free State with a couple in the Eastern Cape and one in KZN – the first wind power project in the province. The names of the wind farms – which are the operating names – were announced, and all of the companies involved were expected to be on the IPP web site by the end of Friday, according to a DMRE spokesman.
Mantashe wrapped up the Thursday evening briefing on the projects with bizarre remarks about load shedding which suggested he is in the dark on the issue.
“I want us to objectively analyse the situation, the trends of load shedding. We hardly have load shedding during the day. We have load shedding twice at night. And that should be indicating something about the state of our base load compared to the additional capacity from renewables,” he said.
Anyone who lives in South Africa – unless they are in a blue light bubble it seems – knows that load shedding is a frequent occurrence during the day, which is why it so disruptive to the economy. And in terms of base load, Eskom still gets about 80% of its power generation from coal. Does the minister think that coal – which he has shown himself to be a fan of – does not burn at night? The remarks were indeed puzzling in a Trumpian kind of way.
He went on to say that: “I am leaving that to experts to do that analysis because if they don’t we are going to be chasing our tails. They say when are we going to stop load shedding and find that we actually have sufficient supply during the day. At night we have no supply, very short of supply because our base load is weak … If we don’t have base load to support renewables we are headed for disaster.”
Ultimately, the remarks were another swipe at renewables by a minister who has shown himself to be a far bigger fan of nuclear power and coal. And saying that “we are headed for disaster” was also rich. Load shedding is a frequent occurrence during the day – a major obstacle to investment and a key reason why the unemployment rate is 34.4% – as debt-laden Eskom scrambles to maintain an aging fleet that was neglected for decades. South Africa is not headed for a disaster – it is a disaster. DM/BM