02 Nov 2015

Renewable energy projects financed by Standard Chartered Bank, are said to be currently producing more than 40 per cent of the 1 760 Megawatts (MW) by Independent Power Producers, (IPPs), under the Renewable Energy Independent Power Procurement Programme, (REIPPP), delivering roughly the same amount of power that is cut when phase one load shedding occurs to South Africa’s national grid.

A news release from Standard bank indicates that the bank has provided finance to 14 active renewable energy projects delivering power to South Africa’s power grid, helping to alleviate a chronic energy shortage.

Africa’s biggest lender by assets has also provided an additional financing for more renewable energy projects that are yet to come on stream, but which are anticipated to add a further 800MW of power to South Africa’s power generating capacity.

“We remain committed to supporting and growing the power sector, not only in South Africa, but throughout the rest of the continent as well,” says Rentia van Tonder, the head of Renewable Energy, Power and Infrastructure at Standard Bank South Africa.

He however states that, it remains important to choose the right projects that demonstrate the greatest potential to add a sustainable, renewable energy source to that specific country’s grid, with the emphasis on long term partnerships.

 The release further establishes that, electricity demand in South Africa is expected to double over the next 20 years, necessitating a greater need for alternative sources of power so as to reduce the country’s reliance on coal-fired power, which currently accounts for about 80 per cent of Eskom’s 4 4000MW of capacity. 

The utility’s REIPPP, which was started three-and-a-half years ago, is said to have resulted in the allocation of power purchase agreements to 92 projects after four rounds of bidding, with the projects that have already been connected to the grid, currently providing a total capacity of 1 760 MW to South Africa’s total generating capacity.

“A commitment to alternative power can make a real difference and lift the load-shedding burden facing many business and consumers, the ability of the economy to grow will be extremely limited if we cannot generate more power, while there is also increasing pressure to reduce the nation’s carbon footprint,” states Ms van Tonder. 

According to the Department of Energy in South Africa (DOE), goals beyond 2020 include contracting more than 20 000MW of renewable energy, including an increasing share from regional hydro-electricity.

South Africa’s Integrated Resource Plan (IRP) was promulgated in March 2011, but numerous delays to new power plant construction have led to a number of rolling blackouts this year.

“Based on the success of the first few rounds of bidding, renewable energy is being seen as a viable way to get more clean energy into the grid relatively quick, more than 70 bids were seen in the fourth round in August last year, emphasising the continued interest in the programme by foreign investors” cites Ms van Tonder. 

Other programmes that are expected to drive the supply of power in the future include co-generation, where industrial users can produce and supply extra energy to the grid from their own waste heat. Baseload power, which would include natural gas, hydro and coal-fired independent power producer projects, is another potential solution. 

It even goes further to state that, gas utilisation master plan is in the advanced stages of approval and the DOE’s recent  gas request for Information (RFI), has already received responses which are currently under review, adding that the off-grid renewable energy solutions are also being sought.

The total estimated renewable energy market in South Africa is currently worth more than R180 billion, and is anticipated to reach over R300 billion. Ends