The RES4Africa Foundation and CESI S.p.A., last week released a study to support South Africa’s energy sector reforms. The study titled, Fostering RE within an Independent Network System Scenario, was released during a webinar organised by the Rome-based Foundation in collaboration with Nedbank.
The RES4Africa Foundation webinar saw the participation of high-level speakers from the international renewable energy sector.
“The report aims to present the most emblematic international case-studies of power sector reform and renewable integration in order to support the decision-making process that is currently undergoing in South Africa,” said the RES4Africa Foundation.
South Africa is on the cusp of a major shift in its energy industry, as the government looks to open up the electricity market
Caspar Herzberg, President MEA at Schneider Electric
South Africa’s electricity generation is reliant on coal, but efforts are ongoing to diversify the energy mix. The National Development Plan 2030 envisages the decommissioning of 35 GW (out of 42 GW currently operating) of coal-fired power capacity and to supply at least 20 GW of the additional 29 GW of electricity needed by 2030 from renewables and natural gas (6 GW of new solar PV capacity and 14 GW of new wind power capacity will be commissioned by 2030). Such amount of variable renewable generation needs to be integrated into the power system by implementing adequate actions aimed at assuring its security and reliability.
Reforming Eskom
At present, South Africa’s electricity sector is dominated by Eskom, a vertically integrated public utility that operates 30 power plants with a nominal capacity of 44 GW, roughly equivalent to 86% of total capacity, divided into thermal coal (36 GW), nuclear (2GW), gas fired (2.5 GW), hydro (3.3 GW) and wind (100 MW). The public utility currently generates approximately 95% of the electricity consumed in the country, owning its transmission grid and 60% of the distribution grid, for a total of more than 6 million direct customers served. As an exclusive large-scale vendor, Eskom also exercises a monopoly of power, performing the role of buyer in the main VREs promotion frameworks.
To favor an efficient and effective energy transition, the Government of South Africa is envisaging to reform Eskom, since phasing out coal while rapidly deploying RES and smart grids require a different and more open market framework. In order to support South African’s decision making process, RES4Africa’s study identifies and analyses the most emblematic global case-studies of power sector reforms, focusing on worldwide experiences of transmission unbundling, economic and tariff regulation of transmission system operators and VRE deployment. The report also provides a possible roadmap for the country’s energy transition.
“Renewables and reforms are the two crucial pillars to enable a positive energy transition” said Roberto Vigotti, RES4Africa’s Secretary General “A strategic reform of the energy system is the key to guarantee a sustainable energy mix for South Africa, improving the quality of the service and increasing the RES generation”.
