{"id":390885,"date":"2020-04-20T12:04:25","date_gmt":"2020-04-20T10:04:25","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=390885"},"modified":"2020-04-20T12:11:52","modified_gmt":"2020-04-20T10:11:52","slug":"coronavirus-leaves-south-africas-green-energy-plans-in-disarray","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/energy\/390885\/coronavirus-leaves-south-africas-green-energy-plans-in-disarray\/","title":{"rendered":"Coronavirus leaves South Africa\u2019s green energy plans in disarray"},"content":{"rendered":"

Independent energy producers were finally making headway in their bid to persuade South Africa\u2019s government to revive long-stalled plans to buy more renewable power when they encountered a new obstacle: the coronavirus.<\/p>\n

A five-week shutdown that was imposed in a bid to curb the spread of the disease has sent electricity usage through the floor and left Eskom, which supplies about 95% of the nation\u2019s power, with excess capacity.<\/p>\n

Economic growth and energy demand are likely to remain muted for several years, casting doubts over when additional plants will be needed.<\/p>\n

Eskom, which was previously forced to implement rolling blackouts because its ageing plants couldn\u2019t deliver sufficient output, has already declared force majeure with wind-energy producers because it doesn\u2019t need their output.<\/p>\n

And the government which pledged as recently as February to seek new bids from renewable suppliers has gone to ground on when that will happen.<\/p>\n

Eskom\u2019s decision to renege on its contracts \u201creally undermines the confidence and the trust that investors have\u201d in the government\u2019s commitment to source additional renewable energy, said Paul Semple, joint head of unlisted credit at Futuregrowth Asset Management, the country\u2019s biggest specialist bond fund manager.<\/p>\n

Funding costs<\/strong><\/p>\n

Investments in renewables projects are based on 20-year returns, and if those don\u2019t materialise as anticipated, the cost of funding for future projects will go up, according to Semple.<\/p>\n

Futuregrowth\u2019s Power Debt Fund has invested more than R8 billion ($428 million) in energy-related projects in South Africa.<\/p>\n

The South African Wind Energy Association is banking on the government implementing its approved energy blueprint that determines the generating capacity it will buy over the next decade, according to Ntombifuthi Ntuli, its chief executive officer.<\/p>\n

She also expects President Cyril Ramaphosa\u2019s administration to formulate a plan to counteract the economic effects of the pandemic that will promote private generation.<\/p>\n

\"\"<\/a><\/p>\n

\u201cWe are expecting that wind energy and other renewables will be part of that stimulus package, since it is infrastructure investment that government does not have to put capital investment in,\u201d she said. \u201cEnergy security will be a big part of helping the economy get back on track.\u201d<\/p>\n

South Africa\u2019s power demand has plummeted by as much as 9,000 megawatts since the lockdown came into effect on March 27. Just days earlier, Eskom had issued a request for proposals to supply it with emergency power, with submissions due to close on April 30.<\/p>\n

\u201cPost the lockdown, Eskom expects demand for electricity to rise to more or less the same levels\u201d as before, the utility said. \u201cThat means there will still be a need for increased independent power producer contribution into the grid.\u201d<\/p>\n

The Department of Mineral Resources and Energy didn\u2019t immediately reply to emailed questions about when the next bid round for renewable projects will go ahead.<\/p>\n

\n

Read: Eskom doubles maintenance work as demand drops<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Independent energy producers were finally making headway in their bid to persuade South Africa\u2019s government to revive long-stalled plans to buy more renewable power when they encountered a new obstacle: the coronavirus.<\/p>\n","protected":false},"author":59,"featured_media":177295,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9874],"tags":[26],"class_list":["post-390885","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-energy","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/390885","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=390885"}],"version-history":[{"count":4,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/390885\/revisions"}],"predecessor-version":[{"id":390907,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/390885\/revisions\/390907"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/177295"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=390885"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=390885"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=390885"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}