Today, RES4Africa Foundation, in cooperation with CESI SpA, released the study “Fostering RE within an Independent Network System scenario". 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.
Although South Africa has a well-developed electricity network and one of the highest rates of electricity access in sub-Saharan Africa, electricity generation is reliant on coal (over 70% of the energy consumption). However, efforts are ongoing to diversify the energy mix, as the coal-fired fleet is ageing, and new projects will not fully compensate for the phase out of the existing fleet. The Country’s government is focusing on diversifying the power mix by introducing natural gas and renewables.
Moreover, South Africa’s electricity sector is dominated by Eskom, a vertically integrated public utility that operates 30 power plants and 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. 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 this respect, 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.
Therefore, the study highlights how renewables can help South Africa to achieving ambitious goals in terms of capacity flexibility and deployment: the country is currently planning to add 6,000 MW of new solar PV capacity and 14,400 MW of new wind power capacity by 2030.
In particular, the study by RES4Africa and CESI proposed a SWOT framework of analysis, and focused on some points of weakness, and potential threats affecting the electricity sector. The former comprises an inflexible and risk-prone generation mix, an insufficient and undermaintained transmission and distribution, difficulties in collecting payment and in curbing the theft of electricity assets and the abovementioned framework of political instability. For the latter, the report highlighted external threat elements represented by the stagnant economic outlook, the reliance on internationally-set commodity prices to GDP growth (not only coal and gas for thermal generation, but also the different mineral materials that the country exports) as well as the ever-pressing issue of environmental impact, exacting a toll in terms of lives and quality of living especially in disadvantaged areas.