Renewable energy will play a significant role in the country's future supply, although significant developmental challenges remain.
So said deputy energy minister Barbara Thompson, speaking at the Energy Indaba, in Sandton yesterday. This comes with the news that the Integrated Resource Plan (IRP) 2010, which maps out the country's energy mix for electricity over the next 20 years, is set to be promulgated by the beginning of April.
The Department of Energy's (DOE) director of electricity, Thabang Audat, said it would present the plan to the Cabinet committee on 9 March, with the process expected to take until the end of the month, after which the IRP should be promulgated.
While the National Energy Regulator of SA approved the renewable energy feed-in tariffs in 2009, independent power producers (IPPs) have been waiting for clarity around regulations, including the power purchase agreement, to go ahead with projects. These are set to be spelled out in the awaited IRP.
The department has identified clear targets for renewable energy options within the plan, with 1 025MW to be procured from renewable sources. This reaffirms the Renewable Energy White Paper target of 10 000GWh (approximately 4% of the energy mix) by 2013.
Thompson said government recognises that renewable energy has the potential to contribute immensely to energy supply security. “Diversification of energy sources, expanding access to energy services, and contributing to sustainable development through the optimum use of cleaner energy resources is critical, especially in this era.”
She added that government is building large-scale renewable energy capacity in concentrated solar power (CSP), solar thermal, and wind, as well as landfill gas, to ensure a sustainable energy mix and reduce the country's coal-dominated electricity generation regime.
While SA is rich in a number of renewable energy sources, Thompson added: “We still have the gigantic task of developing them to their full potential, and this is the challenge facing not only government, but stakeholders.
“We will continue to collaborate with international partners in seeking environmentally benign solutions for our energy-intensive economy. Among these will be energy efficiency, demand-side management and renewable energy options,” she noted.
“In SA alone there's a need for an estimated 50 000MW of new generation capacity by 2028. That tremendous need translates into tremendous opportunity, both in SA and throughout the region.”
He added that feed-in tariff (Fit) programmes around the world had proven highly successful at achieving renewable power generation, as well as job creation.
“They also encourage investment in technology and production, leading to growth in industry, innovation, and lower costs.”
Brodsky pointed to the Fit programme in Germany as an example, which in 10 years more than doubled the country's proportion of renewable energy production, from 6% to more than 15%, and increased jobs in the renewables industry from 30 000 to 300 000.
In September last year, the DOE published the requirement for information from developers of Refit and co-generation projects up to March 2016. According to Brodsky, 384 responses for a total of 20 000MW of Refit and 4 000MW of co-generation were received. The capacity is made up of 70% wind, 15% photovoltaic, and 10% CSP.
Brodsky said the Refit programme is a good start, although many issues still need to be resolved, including the regulatory framework, the identity of the buyer, and procurement processes. The rules also raised questions around technology preferences and caps, minimum project size, and timing, all of which will hopefully be clarified in the promulgated IRP.
“There's a serious need for clear, unambiguous, fair and transparent legislation and regulations,” said Brodsky.
“Independent power producers in SA have been through a number of false starts and investors, whether South African or international, can only be asked to continue spending time and money for so long.”
He stressed Refit's potential for the economy. “The prize is huge if we get it right. Estimates suggest that SA's renewables sector could create over 145 000 jobs in the country.”
According to Brodsky, the indirect impact could be even greater, with the creation of new industries, both domestic and exportable, and an increase in foreign investment.
“SA's Refit programme has attracted interest from leading overseas developers of RE technologies,” he said, adding that new industries will lead to green jobs and skills which can be used again locally and transferred to other countries.
Thompson concluded by emphasising the risks of climate change, and the need to balance the use of fossil fuels with alternative energy, to help mitigate the impact of increasing greenhouse gas emissions.
“The energy challenge facing us is how to deal with the threats of climate change, while meeting the increasing demand for energy, safeguarding the security of energy supply, protecting the poor from rising prices, as well as protecting the environment.”
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