IPPs pin hopes on Eskom’s next boss

SA’s renewable energy industry looks to new leadership at Eskom for the rejuvenation of the renewable energy procurement programme.

Johannesburg - The South African renewable energy industry is pinning its hope on new leadership at Eskom for the rejuvenation of the renewable energy procurement programme, the future of which was recently thrown into doubt in the face of criticism from the power utility.

Under chief executive Brian Molefe’s leadership, which comes to an end on December 31, Eskom has become critical of renewable energy, with Molefe often questioning its costs.

Eskom has also previously claimed that renewable energy technologies delivered electricity at times when electricity demand was low.

Read also: Eskom lauds outgoing Molefe

Commenting on Molefe’s resignation, SA Renewable Energy Council (Sarec) board member Mike Levington said yesterday: “We hope that the appointment of a new chief executive will lead to constructive communication between Eskom and Sarec, as well as reinvigoration of momentum in the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP), the financial close of the Redstone (Concentrating Solar Power) project from Round 3, the 26 projects from Round 4 and the Small IPP programme, and the announcement of the Expedited Round preferred bidders.”

Criticisms

Sarec represents renewable energy associations such as the SA Wind Energy Association, the SA Photovoltaic Industry Association, the Southern Africa Solar Thermal and Electricity Association and the Sustainable Energy Society of Southern Africa.

Sarec said it had “in the main” a constructive working relationship with Eskom around REIPPPP since its inception in 2012.

“We have, however, found the increasingly irrational and inaccurate criticisms levelled at renewable energy and the REIPPPP by Molefe and (Eskom group executive for generation, Matshela) Koko in recent months difficult to fathom, particularly since neither has ever sought to engage with the industry directly through well-established platforms to do this,” Levington said.

Read also: 'Molefe's exit a blow to SA's nuclear plan'

The body said failure to follow clearly understood communication channels had led to the erosion of investor confidence in the South African IPP sector, confusion around energy policy, loss of jobs in a fledgling domestic renewable energy industry and anger among local communities who should have already been receiving the benefits of job creation and socio-economic dividends if Eskom was fully supportive of REIPPPP.

Sarec said the renewable energy sector had been ready for almost 12 months to play an active contribution towards the government’s Nine-Point Plan, which is an initiative to boost economic growth and create jobs by, among others, resolving the country’s energy problems and encouraging private sector investment.

It said, after closing the so-called Round 4 and the Expedited Round, investment in REIPPPP could be more than R250 billion.

“With the ratification of the Paris Agreement on climate change and the current climate negotiations in Marrakech, Morocco, we also hope that Eskom, (National Energy Regulator of SA) and other government stakeholders realise the potential that renewable energy can play in meeting both South Africa’s climate change commitments, as well as empowering its citizens through access to more affordable electricity.

“It is potential that (the Brazil, Russia, India, China and South Africa business communities) and the world at large are embracing - so should we,” Levington said.

Regrettable

Meanwhile, National African Federated Chamber of Commerce and Industry (Nafcoc) said Molefe’s departure “at the time when confidence in the security of our energy supply is returning and globally admired progress is being made in the renewable energy programme” was regrettable.

Nafcoc’s chief economist, Landiwe Jackie Mahlangu, said:”Molefe’s resignation serves to indicate the fragility of our transformation project, which when faced with crises, often results in the premature attrition of the black leadership talent and the erosion of its critical mass.

“This unfortunate incidence must spur all of us to make our transformation much more resilient,” Mahlangu said.

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