A decision by South Africa's Department of Mineral Resources and Energy (DMRE) to allocate 6GW of new large-scale solar over the next decade has been welcomed by the South African Photovoltaic Industry Association (SAPVIA) for giving a “moderate level of certainty” to the industry.
The Integrated Resource Plan 2019 (IRP) aims to allocate the capacity in 1GW instalments each year in 2022, 2023, 2025 and 2028-30, but the omitted years have given rise to concern about continuity.
SAPVIA chairperson, Wido Schnabel added: “We will continue to engage the Minister of DMRE to find mechanisms to smooth out the gaps presented in 2024, 2026 and 2027, where no solar PV is envisaged to be added to the grid.”
The association also suggested that the IRP had not put forward the “least cost model”, but did accept that it provides potential PV developers, investors, operators and equipment manufacturers with a stable outlook in the medium term. It also welcomed openness from the government to amend the IRP over time to best suit the industry on the ground and it even forecast that an even larger renewable energy allocation could be in the wings.
The country already has committed solar allocations of 114MW in 2020, 300MW in 2021, and 400MW in 2022. With the addition of the IRP allocations, solar’s total installed capacity of 8,288MW would account for just 10.52% of the country’s energy mix by 2030.
SAPVIA COO, Niveshen Govender had several further requests, including expedition of the analysis required for the next version of the IRP, as well as speedy implementation of the Round 5 bidding window under the Renewable Energy Independent Power Procurement Programme (REIPPP).
The IRP also put forward plans for 6GW of small-scale generation capacity - known as ‘embedded generation’ in South Africa - increasing the original annual plan of 200MW to 500MW.
“The waived requirement for ministerial deviation on 1-10MW SSEG [small-scale embedded generation] projects, and the allocation to embedded generation, based short term capacity and energy gaps, are great portents for the sector’s future,” said Govender. “We encourage the Department to swiftly gazette an amendment to Schedule 2 of the Electricity Regulation Act, thereby allowing for licensing exemptions for projects with a generating capacity less than 10MW.”
South Africa’s current power capacities include 38GW from coal, 1.8GW from nuclear, 2.7GW from pumped storage, 1.7GW from hydro, 3.8GW from diesel and 3.7GW from renewable energy.
The IRP stated that coal will continue to play a significant role in electricity generation “in the foreseeable future” as it is the largest base of the installed generation capacity and it makes up the largest share of energy generated. The Plan called for new investments in more efficient coal technologies.
Small nuclear energy units were picked out as a more “manageable investment” when compared to a fleet approach. Meanwhile, natural gas plants would provide the flexibility required to complement renewable energy technology as it increasingly penetrates the grid.
For renewables, the IRP stated: “Solar PV, wind and CSP with storage present an opportunity to diversify the electricity mix, to produce distributed generation and to provide off-grid electricity. Renewable technologies also present huge potential for the creation of new industries, job creation and localisation across the value chain.”
Wind has come out as the favoured option with a significantly higher allocation than the other alternative energy sources. It will have 1,600MW allocated every year from 2022-2030 (14.4GW in total).
Energy storage is seen as another potential solution to the increasing levels of variable renewable energy generation coming online and tending to produce power at off-peak times. Storage was allocated 513MW of capacity in 2022 and 2.5GW in 2030.
The IRP detailed why it is necessary to impose building limits on renewables, claiming that it “smoothes out” the capacity allocations for wind and solar PV, which provides a constant pipeline of projects for investment and thereby addresses investor confidence. It also prevents erratic annual capacity allocations.
The plan stated: “When annual build limits on renewables are imposed and realistic gas availability assumptions are applied, the system builds battery storage and coal to close the gap. Imposing annual build limits on renewables for the period up to 2030 does not affect the capacity from wind or solar PV in any significant way.”
The IRP document can be found here.
The Energy Storage Summit, now in its 6th year is renowned for its quality, breadth and expertise, featuring an all-encompassing range of strategic and technical sessions on the adoption and deployment of storage. The Summit plays a pivotal role in the journey to propelling the industry into the next stage of its development, providing an unrivalled platform to develop the right partnerships and create business opportunities of all sizes. This eco-system event brings together the entire value chain including Utilities, Developers, EPCs, Investors, Manufacturers, Energy storage providers, local government and DNO’s making this one of the must–attend storage events for 2021.
The Energy Storage Digital Series provides the industry a platform from which to super-charge sales and marketing efforts at a time when travel and event interaction is restricted. Over the course of 5-days vital and exciting information will be broadcast live via our webinar system and recorded, plus pre-recorded webinars for you to view on-demand. Dedicated live and previous podcasts to listen to, resources and more content that you can download for free at a time that suits you.
Hear from industry experts on some of the leading issues such as ensuring health and safety for lithium ion installations and our cutting edge beyond lithium content showcasing some of the most exciting new technologies and chemistries coming to the fore.
The Energy Storage Latin America agenda provides the industry with an unrivaled opportunity to discuss how the region is set to unlock the full potential of energy storage, accelerate deployment and address the main regulatory and financing challenges. The Energy Storage Summit Latin America is the first event of its kind, designed with a clear goal to accelerate both dialogue and deployment of energy storage solutions. Hear from a world-class line up of industry speakers discussing: The changing market, Active and pending projects, Regulatory environment, Financing options and New storage technologies. This event is the only place where the entire energy storage value chain will be present. Enquire now and be part of an unparalleled platform enabling you to network and do business with: Government, Utilities, Developers, EPCs, Investors and more.