The decision by the SA government to accept bids to boost Eskom capacity of electricity production is a step in the right direction to address the South Africa’s protracted power crisis.
Eskom, a South African electricity public utility, established in 1923 as the Electricity Supply Commission (ESCOM), has been struggling with rotational load shedding to handle the constraints. Eight independent energy producers have been introduced to provide 1 845 MW extra electrical energy to boost the existing generation capacity.
Diverse sources
Mineral Sources and Vitality Minister Gwede Mantashe stated that the power generation projects will inject a total of R45 billion private-sector funding to the financial system. Bidders are required to have 51% South African entity participation and 41% black possession.
Significantly, bidders have chosen diverse power generation sources such as photo voltaic power (Solar), wind, liquified pure fuel and battery storage for the task. The bidders are ACWA Energy Venture, Karpowership SA Coega, Karpowership SA Richards Bay, Karpowership SA Saldanha, Mulilo Complete Coega, Mulilo Complete Hydra Storage, Oya Vitality Hybrid Facility, and Umoyilanga Vitality.
The renewable electrical energy, thus produced is to be added to the main grid from August 2022, boosting a much-needed capability of Eskom, which has been struggling with power shortages for years and has been accused of depriving the nation of its financial development.
Power shortage for five years
Eskom, which is the dominant player in the electricity supply in South Africa had forecasted that it will have a power shortage of 4 000 MW over the coming 5 years.
The renewable power is supposed to complement Eskom electrical energy supply as an alternative until utility operational challenges are resolved.
In addition the SA government has introduced the Request for Proposal (RFP) for the procurement of two 600 MW beneath the Renewable Vitality IPP Procurement Programme Bid Window 5.
A total of 1 600 MW of the two 600 MW from Bid Window 5 may be generated from wind and 1 000 MW will from photo voltaic power (solar).
The SA authorities expected to add the newly generated power to the grid as soon as possible in the context of the on-going power crisis.
The set target is to generate 13 813 MW from a combination of diverse power sources. This, of course, in line with the President Cyril Ramaphosa’s financial restoration plan.
No quick fixes
The fact remains that there are no quick fixes for a simmering crisis of this magnitude. Needless to say that power generation and steady power supply is vital for a vibrant economy. So far the South African government could not provide the country with steady power supply and the power shortages and load shedding have been recurrent feature and acts as negative factor for possible Foreign Direct Investments (FDIs).
South Africa should come out with a master plan to address the issue of not only current shortages of electricity, but also to meet the growing power demand in the years to come. If the power crisis continues, it would adversely affect the overall economic progress and growth. It would dissuade potential investors from investing in South Africa.
