Riyaz Patel
South Africa’s Cabinet has approved the promulgation of the Integrated Resource Plan (IRP2019) which provides a blueprint for South Africa’s envisaged energy mix until 2030.
Following its fortnightly meeting Thursday, Cabinet said the IRP2019 proposes nine interventions that respond to the country’s energy needs for the next decade.
“The plan remains within the policy framework of pursuing a diversified energy mix that reduces reliance on a single or few primary energy sources. It will be revised in line with the changing energy sector environment,” a Cabinet statement said.
Mineral Resources and Energy minister Gwede Mantashe is scheduled to outline the contents of the long-awaited plan Friday.
“The news comes as a great relief after months of uncertainty, in the midst of yet another round of load shedding implemented by Eskom on Wednesday, which is expected to last well into next week,” said Bianca Botes, Treasury Partner at Peregrine Treasury Solutions.
In August 2018, Cabinet approved the release of the draft IRP2018 for public consultations.
Most of the inputs received from the public, academics, experts from the energy sector and relevant stakeholders such as the National Economic Development and Labour Council (Nedlac) and the Portfolio Committee on Energy, were included in the IRP2019.
The announcement coincides with news that the SA government is in talks with power producers to try and secure cheaper electricity from some older renewable energy projects, Reuters reports.
But participant power firms – some of which are backed by big names such as EDF Renewables – say they can’t give the government big savings on many of the 64 solar and wind projects that are under discussion, because most of the money has already been spent.
Lenders and lawyers said the government was being unrealistic by targeting quick reductions in power prices through a “collective bargaining” approach used in wage talks with unions.
Renewable energy projects are protected by more than R140bn of state guarantees, exposing the government to huge penalties if it were to terminate or breach existing agreements, said Reuters.
Mantashe and Public Enterprises Minister Pravin Gordhan have stressed the talks are voluntary, asking for firms’ cooperation as “good citizens” at an October 4 meeting, according to minutes of the meeting.
Mantashe told power firms that the “government isn’t the enemy of renewable energy” but that if administered prices such as those for electricity failed to come down then the economy would not grow, the minutes seen by Reuters showed.
