South African President, Cyril Ramaphosa’s energy plan will reportedly add 1,950 MW of electricity to the country over the next three months to ease the country’s perennial electricity crisis.
However, it does not suffice to cover up the shortages faced by Eskom. The country has been experiencing bouts of power cuts as its public utility faces, at worst, a shortage of almost 6,000 MW of electricity with its breakdown-susceptible power stations.
It is reported that in the early last month, rolling blackouts reached Stage 6 due to challenges posed by the staff of the power utility downing tools.
President Ramaphosa, therefore, made these interventions to deregulate the energy sector and having the private sector plays a critical role in putting an end to the 14-year-old crisis.
However, this would still leave a supply shortfall of 4,000 MW on the worst of the powercut days, which has put South Africa in an uncertain position to face further incidents of rolling blackouts, further crippling the economy and impacting the investment potential.
It is expected that the President’s energy investments will likely make a difference by 2023, implying that these measures will stay in place for at least the next 12 months.
Pravin Gordhan, Minister of Public Enterprises, stated that around 2,000 MW of energy will be added to the national grid by enabling independent power producers (IPPs) to provide wind and solar power. The necessary regulatory exemptions as well as negotiations with neighboring nations have also been initiated for supplying their spare power in South Africa. .
Additionally, around 1,000 MW will be available in the next three months from the existing IPPs to be added to the grid, with a potential for a surplus600MW when certain regulatory exemptions are made, such as removing localization requirements.
The biggest intervention, however, will be the elimination of the 100MW cap on electricity generation by private sector firms for personal use, pushing several homes, businesses, and industries to be powered by renewable energy.
The SA President has thus relaxed regulations which mandated renewable energy investors to follow the localization requirements.