By Ethan van Diemen

26 Jul 2022
original article here

President Cyril Ramaphosa on Monday night announced what he called an ‘energy action plan’ to tackle South Africa’s power crisis. This is what the plan entails.

On Monday night, President Cyril Ramaphosa announced a set of actions to respond to South Africa’s yearslong energy crisis.

“The crisis that we are facing requires that we should take bold, courageous and decisive action to close the electricity gap,” he said, continuing that, “as government, we are announcing a number of interventions to overcome the immediate crisis”.

Ramaphosa acknowledged that the recent bout of Stage 6 rolling blackouts had “made clear” that “the actions we have taken, and continue to take, are not enough”.

The President announced five actions as well as “additional measures to achieve long-term energy security and end load shedding for good”.

The first action is improving the performance of Eskom’s existing fleet of power stations by, among others:

  • Seeing that Eskom increases its budget allocated for critical maintenance over the next 12 months;
  • Cutting red tape that has made it difficult for Eskom to buy maintenance spares and equipment within the required period to effect repairs;
  • Recruiting skilled personnel, including former senior Eskom plant managers and engineers, from the private sector;
  • Buying surplus capacity from existing independent power producers;
  • Eskom will purchase additional energy from existing private generators such as mines, paper mills, shopping centres and other private entities that have surplus power;
  • The utility will import power from neighbouring countries in southern Africa that have more electricity capacity than they require through the Southern African Power Pool arrangement; and
  • Eskom will use interim power solutions, such as mobile generators, to supplement current generation capacity for a limited period.

Second, Ramaphosa said the government intends to “accelerate the procurement of new generation capacity”, which would include actions such as:   

  • Ensuring that all projects from Bid Window 5 of the renewable energy programme can start construction on schedule. This includes “taking a pragmatic approach” to the local content requirements for these projects and prioritising the need to build new capacity as quickly as possible;
  • Doubling the amount of new generation capacity procured through Bid Window 6 for wind and solar power from 2,600MW to 5,200MW;
  • Releasing a request for proposals for battery storage by September, and a further request for gas power as soon as possible thereafter; and
  • Minister of Mineral Resources and Energy Gwede Mantashe will issue a determination for the remaining allocations in the Integrated Resource Plan 2019 and will open further bid windows “on an expedited basis”.

Private investment

Third, the President announced that the government would  “massively increase” private investment in generation capacity by:

  • Removing the licensing threshold for embedded generation completely and tabling “special legislation in Parliament on an expedited basis” to address the legal and regulatory obstacles to new generation capacity for a limited period;
  • Waiving or streamlining certain regulatory requirements “where it is possible to do so within existing legislation”, which could include reducing the regulatory requirements for solar projects in “areas of low and medium environmental sensitivity”;
  • Eskom will be enabled to expand power lines and substations “without needing to get environmental authorisation in areas of low and medium sensitivity” and within the strategic electricity corridors; and
  • Establishing a single point of entry for all energy project applications, to ensure the coordination of approval processes across the government.

Fourth, he said that the government would enable and incentivise businesses and households to invest in rooftop solar by:

  • Seeing that Eskom develops rules and a pricing structure — known as a “feed-in tariff” — for all commercial and residential installations on its network that would enable homeowners and businesses to sell surplus power to Eskom.

The President said his administration would attempt to “fundamentally transform” the electricity sector and position it for “future sustainability” by:

  • Appointing boards for the transmission and generation entities that would fall under Eskom; and
  • Expediting the finalisation of the Electricity Regulation Amendment Bill to enable private sector investment.

The President’s announcement follows — and seems to incorporate parts of — calls by an ever-expanding body of people and organisations across the spectrum, from civil society to academia, from Eskom itself to energy experts, who have all come out with suggestions and studies on how best to rapidly put an end to or otherwise ameliorate the crisis.

The ever-growing chorus of voices calling for rapid, decisive action followed weeks of some of the most severe rolling blackouts the country has ever experienced in the 15 years since the first power cuts.

Sikonathi Mantshantsha, Eskom’s spokesperson, previously told this reporter: “The two primary reasons for load shedding are the unreliability and unpredictability of Eskom’s generation fleet … and a lack of generation capacity in the country.”

Eskom has an energy shortfall of 4,000MW to 6,000MW and adding this new generation to the national grid would significantly reduce the number of rolling blackouts, he said.

This, in addition to Eskom’s plans to decommission 8,000MW to 12,000MW of coal-fired power generation by 2030 in line with global climate imperatives — and the impact of failing, aged power stations — underscores the urgency and necessity of adding new, cleaner power generation capacity.

Jan Oberholzer, the utility’s chief operating officer, has said that South Africa needs to add 50,000MW of additional generation capacity to the grid over the next 13 years to cover the energy supply gap and replace retiring coal stations. Put differently, Eskom needs to double the capacity provided by its entire fleet — which at present is about 46,000MW — if it is to ensure and sustain energy security.

National Planning Commission

The National Planning Commission, chaired by Minister in the Presidency Mondli Gungubele, on 6 July proposed a number of measures to end the crisis that has left the nation reeling in the darkness.

The commission proposed:

  • The 100MW ceiling be removed, as the Eskom grid could regulate the increased energy market;
  • National Energy Regulator of South Africa regulations on the registration and implementation of renewable projects be scrapped and replaced with an online registration procedure;
  • The fast-tracking of environmental assessments; and
  • A temporary exemption from local-content requirements for the construction and commissioning of new projects that will come online in the next three years.

At roughly the same time, an ANC statement on the outcomes of its National Executive Committee meeting urged the government and Eskom to:

  • Increase maintenance and improve the availability of existing supply;
  • Facilitate private investment in new-generation capacity;
  • Speed up the repurposing of power stations with alternative energy sources;
  • Accelerate the procurement of battery storage;
  • Empower municipalities to procure additional energy sources; and
  • Encourage businesses and households to invest in renewable energies.

DA members of Parliament Kevin Mileham and Ghaleb Cachalia, in a joint statement released after the President’s address, said: “While the DA welcomes the steps taken by the President to address the energy crisis, we still find it unacceptable that it took this long to take action.

“Now that an energy plan to address the electricity crisis has been announced, the DA will soon be launching an Energy Plan Implementation Tracker to keep Ramaphosa’s government honest on project implementation and red-tape reduction milestones. The tracker will particularly hold the President accountable on the commitments made to add new generation capacity.”

Good party Secretary-General and MP Brett Herron said: “It is common sense that adding extra electricity production capacity, diversifying the source of our electricity and stabilising the supply from the current Eskom supply fleet has been the urgent interventions we have needed.

“The President has announced interventions that will address these persistent, but obvious, failures that South Africans have endured for far longer than we ever needed to. South Africans have endured electricity blackouts, euphemistically called load shedding, for 15 years. We have suffered enough.

“We have to work together to ensure that the interventions announced tonight materialise and that the urgency does not subside with the subsidence of the current load shedding crisis.” DM