South Africa’s Independent Power Producers programme is heading towards its fourth phase and while the bidding process has been described as highly successful, there have been some challenges when it comes to connecting the new renewable plants to the grid.
Grid connectivity delays
Ayanda Nakedi, senior general manager of the renewables business unit at Eskom, told Engerati at African Utility Week, that there has been no alignment between Eskom’s infrastructure planning and winning bidders’ renewable plans. Often, the areas pinpointed for renewables development are located far from the grid. Nakedi says that there are now plans in place to ensure that grid strengthening occurs in areas that enjoy an abundance of natural resources before the actual bidding takes place.
This means that time-consuming environmental approvals are done in advance of the bids so that the infrastructure is available before the plants are built. Nakedi adds that strategic areas will now be identified in order to speed up development time. She says that the aim is to reduce delays for connectivity and also make project and financial planning easier (and less stressful) for investors and the utility.
Local community development
Nakedi says it has also come to her attention that locals are not benefitting from new renewable developments. To rectify this, policies have been put into place to ensure that social upliftment in communities is created around these plants. “The plant owner must prove that something is being done to improve the lives of those living close to the plant.”
Sarah Stands of Wind for Communities Working Group, told Engerati at the event that when it comes to renewable energy development, the aim should be to find the most benefits for the surrounding communities where possible.
She says that appropriate policies would help to fast-track this social upliftment. “This will ensure that expectations and deliverables are met.”
Stands notes that many communities may never realise the potential that infrastructure development offers which in turn creates job opportunities and general economic development. “The challenge starts on the ground as developers and communities could come up against many misunderstandings so it is important to make agreements clear, especially during land acquisition since there’s sometimes an assumption that employment will be provided.”
Delaying grid investment
Nakedi’s department is also taking a serious look into the development of off-grid power so as to delay grid investment. While off-grid power will ease supply constraints, Eskom realises that this will have revenue implications for the utility in the long-term. However, Nakedi says that the utility is looking into prosumer energy sales. “There is a policy that will come from the regulator for small embedded generation to allow prosumers to sell excess energy into the grid. We are in the process of defining tariffs, and technical specifications to ensure that this happens in a safe and efficient manner.”
She adds, “I have no doubt in my mind that the future generation mix will be dominated by renewables. We have to therefore focus on its development, as well as energy storage and smart metering technology. We recognise that battery storage will see utilities lose their customers forever as it is a direct threat to the centralised grid business model. For the survival and sustainability of Eskom, we realise that its model must be geared towards renewables development for it to survive.”