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South Africa

South Africa

SA applications held up by tariff decision

SOUTH AFRICA: South Africa's state-owned utility, Eskom, is holding 156 applications and requests from private energy project developers awaiting the issue of the renewable energy feed-in-tariff (Refit) programme.

The applications and requests have a generating capacity of 15.2GW, of which 13.3GW, or 88%, is from wind power developers, says the company's network planning chief engineer, Riaan Smit.

"The requests will be processed once the renewable energy feed-in-tariff programme requirements have been issued," says Smit. He adds that South Africa's Department of Energy (DoE), the National Energy Regulator of South Africa and the National Treasury were finalising the requirements to be announced before the end of the year.

Eskom has also confirmed a delay for the release of invitations for bids from developers, probably until March 2011, to allow time to review and process the requests for information (RFI) from potential renewable energy developers, co-generation and small-scale electricity projects.

"We hope that the RFI will provide us with enough information to assess the progress developers have made since the announcement of the Refit programme, as well as the readiness of the market to enter into intensive procurement and fast-track negotiation processes," says DoE acting deputy director-general Ompi Aphane.

According to Eskom, the DoE is specifically interested in information on renewable energy projects keen to take advantage of the Refit programme, which includes small hydropower, onshore wind, certain solar technologies and biomass.

The RFI signals South Africa's drive to facilitate independent power producer (IPP) participation in generating electricity as it prepares strategies to achieve 10,000GWh of electricity from renewable sources, or 4% of the country's total energy consumption, by 2013.

Power purchase

Eskom is positioning itself as a designated buyer of electricity generated from IPPs to be selected after the competitive bidding process is in place. It wants to ensure that all stakeholders know what form an independent system operator could take, says Kannan Lakmeeharan, managing director of the systems operations and planning division of Eskom.

Lakmeeharan says the division is in a better position to operate as the single buyer of electricity from IPPs. He comments: "Now that funds are being made available we will be signing up more IPPs in future."

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