CEO of BLSA Busi Mavuso
Congratulations to energy regulator Nersa, as well as Operation Vulindlela, for getting two 100MW private sector solar plants approved. That’s enough energy to supply electricity to about 31,000 households, a significant contribution in the context of our struggle to get supply to match demand and put load shedding behind us.
Sola Group on behalf of Tronox Mineral Sands will develop both solar PV plants in the North West. These are the first private sector energy plants of substantial size to be approved since June 2021 when President Cyril Ramaphosa raised the limit to generate electricity without a licence to 100MW from 1MW, although the governing legislation was gazetted only in August. But apart from public consultations not being required, the approvals process remained much the same as for a licence.
As a result we should only expect the extra 200MW to start generating electricity in about September next year, with financial close scheduled for July and the developers estimating a relatively fast 14 months to construct.
I’ve been highly critical of cumbersome approvals process because getting new energy generated helps to overcome the most critical of the many problems this country faces, our energy insecurity and the persistent load shedding that comes with it. Only once these are resolved do we have any hope of building a stronger, inclusive economy. All processes aimed at achieving energy security need to be accelerated.
Operation Vulindlela, the unit within the Presidency that works with National Treasury to overcome obstacles to reforms, was instrumental in unlocking the 100MW approvals process. Rudi Dicks, the head of the project management office in the Presidency, said a joint task team had been established between government and industry which meets weekly to address constraints.
As a result, things are now up and running and these are likely be the first of many. Sola CEO Dom Wills said this first move was significant as it would pave the way for more large-scale approvals. Earlier this month the Mining Indaba heard that mining companies are prepared to increase their investment in projects in SA by 84% if the government tackles the dysfunction plaguing the processing of mining permits and approvals for self-generation projects, as well as the constraints facing the country’s rail networks and ports.
Hopefully those projects will now start flowing. The more the government brings in the private sector to support it in overcoming SA’s structural problems that plague our economy, the quicker they will be resolved. Outside of energy the urgent areas are our railways and ports and water reticulation systems as well as dysfunctional municipalities that result in dismal standards of service delivery.
But energy remains the most critical emergency our country faces. Eskom states that we need to add a whopping 50MW – equal to replacing its entire fleet which has a capacity of about 45,000MW – of additional generation capacity over the next 13 years to cover the supply gap and replace retiring coal stations. So we need to keep working hard to develop new energy supply while also reacting with zero tolerance to any threats to achieving energy security.
One such threat is the increasing number of sabotage incidents at Eskom. In separate incidents in the past two weeks, power cables were cut at the Tutuka, Hendrina and Matla power stations. These are key installations to the country. Eskom says insiders are suspected and these acts of sabotage happened when the country was already suffering load shedding last week. It seems they succeeded in their intention of ensuring last week’s power cuts were extended to this week.
These are just the latest two incidents. Eskom estimates that acts of sabotage reduced supply in 2020/2021 by 1,034 gigawatt hours which is 0.5% of the total energy demand for the year.
This is disturbing as it appears to be centrally orchestrated and their intention appears to be to destabilise Eskom’s power generation and supply capabilities, if not to crash the system entirely with a total blackout. Such a catastrophe would not only severely cripple the economy but threaten to tip the country into social unrest on a far wider scale than the horrific events of July last year.
As the headline on Kyle Cowan’s News24 column on March 21 asked: Silence on Eskom sabotage leads to one question: Who benefits from energy crisis?
The severity of these acts cannot be overstated. With the dire state that our energy system is in, we are facing a national crisis and every act designed to destabilise supply is an act of treason as it is a betrayal of the country.
What’s alarming is that we’ve heard so little from our security forces about these sinister events that present such a serious threat to South Africa. One hopes they’re not caught napping as they were at the time of the July unrest. Government, with appropriate support from business, labour and communities, needs to act with speed and resolution against those that sabotage our economy and livelihoods for nefarious ends.
Written by Busisiwe Mavuso is the CEO of BLSA. This article first appeared in Fin24.