South Africa can’t afford to kick grid investment can down the road – Ramokgopa

Photo by Creamer Media
2nd July 2023
By: Terence Creamer
Creamer Media Editor

Electricity Minister Dr Kgosientsho Ramokgopa argues that South Africa should give urgent attention to the strengthening and expansion of the transmission grid to avoid any further extension of the prevailing loadshedding crisis, which he says has its genesis largely in the failure of government to respond timeously to the need to add new generation capacity.

“We can’t kick the can down the road in a similar manner as we did with generation,” Ramokgopa said of transmission grid investment during his weekly briefing on the implementation of the Energy Action Plan.

He argued that there were positive signs that the generation supply/demand imbalance was beginning to stabilise, with coal fleet breakdowns having moved to within touching distance of the key 15 000 MW level during the past week, and with demand peaks having remained well below, at about 30 000 MW, the 34 000 MW peak initially assumed when Eskom released its winter plan.

However, the lack of grid infrastructure, particularly in the wind- and solar-rich south-western provinces of the country, was now posing a serious risk to future security of supply, as it meant that renewables plants were struggling to connect to the grid.

The absence of such capacity came to the fore during the sixth bid window of the country’s public renewables procurement programme when none of the 23 onshore wind projects that bid for a 3 200 MW allocation were selected as preferred bids, owing to claims of grid over-subscription in the Western, Eastern and Northern Cape provinces.

“[In the area of generation], we kicked the can down the road as policymakers and we’re sitting with this [current] problem . . . so, we shouldn’t make the same mistake on transmission and think that we can resolve transmission sometime in the future.

“Transmission must be resolved today.”

He stressed, too, that the prevailing lack of investment in the grid was not a consequence of inadequate planning, with Eskom having drafted a credible Transmission Development Plan, but was rather a financing challenge.

The latest TDP points to the need for the construction of 14 218 km of new high-voltage transmission lines by 2032, as well as the deployment of 170 transformers, with a capacity of 105 865 MVA, along with 40 capacitors and 52 reactors.

Highlighting that Eskom was restricted by the National Treasury’s R254-billion debt relief package from taking on new borrowing, Ramokgopa said “more innovative ways” were required to overcome the funding issue.

A report was being finalised on the matter and would outline ways government intended tapping private sector liquidity without creating conditions whereby the State relinquished ownership of the grid, or whereby the system operator relinquished responsibility for grid management.

The report, he said, was far advanced in its drafting and would be shared once it had been through the necessary approval processes.

“It’s going to be revolutionary,” Ramokgopa assured, having previously given an indication that various build, operate and transfer models were being assessed.

The Minister also confirmed that he would be meeting with private wind and solar developers in the coming weeks to understand their concerns with Eskom’s recently unveiled Interim Grid Capacity Allocation Rules.

The rules, which replace the ‘first come, first served’ framework that has hitherto prevailed with a ‘first ready, first served’ approach, give priority to so-called shovel-ready projects in an effort to avoid any hogging of scarce grid resources.

However, the rules have been described as onerous by various bodies representing wind and solar stakeholders.

“I will be taking time within the next two weeks to sit with some of the players there to hear what the issues are,” the Minister said.

South Africa can’t afford to kick grid investment can down the road – Ramokgopa (