SOUTH Africa’s only opposition-led province plans to facilitate the construction of almost 6 GW of power generation capacity to counter nationwide electricity shortages and bolster the regional economy.
The Western Cape aims to add as much as 750 MW of supply by 2025 and to reach 5 700 MW by 2035, Premier Alan Winde, a member of the Democratic Alliance, said in an interview at Bloomberg’s Cape Town office on Wednesday. That should be sufficient to meet demand as the provincial economy expands.
State-owned utility Eskom, which generates more than 90% of the nation’s electricity, has been forced to implement rotational blackouts on a daily basis since 2008, with outages currently at record levels. South Africa’s ruling African National Congress has announced emergency measures and declared a state of disaster to help it address the crisis, but there’s no sign of it abating in the near term.
Winde met with Eskom’s former Chief Executive Officer Andre de Ruyter, shortly after he tendered his resignation in December, to seek advice over how the province should approach energy provision.
“He said you’ve got to become independent as quickly as possible,” Winde recalled. The outgoing CEO didn’t provide much detail, but expressed that “there’s big trouble ahead and, you know, do what you can,” the premier said.
Winde has put a team together to expedite larger generation projects, and intends on assisting municipalities to boost their power supply with a budget that will be announced in mid-March. The World Bank is providing an adviser, Karen Breytenbach, who previously led South Africa’s independent power producer office, to help shape the plans.
One of the key challenges for South Africa’s power system is its inadequate transmission grid. A shortage of connections meant that not a single wind project was selected in the national government’s latest award of contracts to private producers to supply additional electricity.
The Western Cape government has yet to determine which transmission options — Eskom infrastructure, municipal grids and micro grids — will work best and in what combination, according to Winde. The province plans will have to take into account its growing population, which is projected to hit 8-million in the next six years, up from 7.2-million currently.
The ANC has targeted a $250-billion green hydrogen industry by 2050 as part of long-term plans to reduce the nation’s reliance on coal, create a new export industry and use cleaner technologies. Some of those plans include reviving a mothballed ArcelorMittal steel plant in Saldanha, along the coast north of Cape Town, to utilise the fuel.
Sasol has said it would potentially accelerate its own plans to develop and export green hydrogen to meet growing demand from Europe.
A green hydrogen industry, which is dependent on the development of renewable energy, will have to benefit the local economy, according to Winde. Eskom estimates the nation requires 53 GW of clean energy capacity by 2032 to make up for coal plant closures and reach a secure level of supply.
“You can’t have hydrogen exports to Europe and loadshedding in South Africa,” Winde said, using the local term for blackouts. “I mean, the citizens will just burn everything down.”
Bloomberg
