Government signs 27 independent renewable energy agreements

Energy minister Jeff Radebe has signed the 27 outstanding Renewable Energy Independent Power Purchase Agreements today, signifying the government’s commitment to economic growth and prosperity in South Africa.

The outstanding Power Purchase Agreements formed part of the fourth round of REIPPP, South Africa’s world-renowned renewable energy procurement programme.

Radebe signed the agreements after pushing past Numsa’s opposition to the deals, after the High Court threw out the latter’s bid to stop the signing from moving ahead.

“This signing has been a long time coming, and it’s a monumental moment for the South African renewable energy industry,” said Dr Chris Haw, Chairman of SOLA Future Energy, whose subsidiary company Aurora Power Solutions developed 170 megawatts worth of solar PV projects that are currently in preferred bidder status and have been awaiting execution.

Since 2015, after 3 successful rounds of procurement, the programme was stalled despite significant capital investment and job creation that had been made. However, the low cost, low carbon advantages of renewables have now been recognised by the South African government as critical to the country’s future.

Haw said that this signing shows that the South African government is committed to the country’s economic development.

“Renewables are cheaper and more sustainable forms of energy. Their adoption will reduce the cost of electricity for households and businesses in the long run,” he said.

Renewable energy sources have a cheaper levelised cost of energy (LCOE) than coal and nuclear, and their adoption shows the country’s commitment to international economic trends, Haw said.

The signing is expected to create at least 61,000 jobs over the next few years.

Haw said that the signing also shows the government’s potential interest to move ahead with ‘Small Scale’ IPP projects, a programme similar to the REIPPP but for smaller projects that contain a higher degree of local ownership.

“The small IPP projects have huge potential to encourage economic growth. They have a sharp focus on BBBEE, local procurement, and local operation, which means that the economic spinoffs for local economies will be more pronounced per megawatt procured,” Haw said.

The SPP projects were excluded from the group of projects that were approved today, even though they have the same procurement status. The hope is that these will be signed in the near future, Haw said.

Read: A look at FNB and WesBank’s new R60 million solar energy project

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Government signs 27 independent renewable energy agreements