Electricity and Energy Minister Dr Kgosientsho Ramokgopa delivered a keynote address at the Ministerial Renewable Energy Seminar hosted in Midrand, Gallagher Convention Centre on Monday. The seminar aimed to build on the achievements and successes of South Africa’s Independent Power Producer Procurement Programme (IPPPP), by identifying and analysing the challenges and bottlenecks impacting on private investment in energy and formulating strategies to mitigate risks and enhance the growth of the renewable energy sector in the country.
Electricity Energy Minister Kgosientsho Ramokgopa said on Monday that backlogs of over R270 billion in infrastructure projects and in the energy space have been cleared through intense engagements with directors-general as he gave assurance to Independent Power Producers (IPPs) that issues pertaining to procurement were being addressed.
Speaking at an energy seminar on Monday, Ramokgopa said improvements were being made to the bid windows to iron out inefficiencies.
“As part of our quest and to ensure that we see an exponential rise in renewables as part of energy mix, we are going to be a bit more aggressive in embodying bid windows,” he said.
“Of course we were looking at catalytic projects but I can imagine that whatever challenges and encounters that these catalytic projects had are almost the same as smaller projects.
“We had a backlog of these projects, close to R270bn.
“So what we did was to convene all the DGs in the departments that are complicit in the delays of the roll-out we were able to unlock. We go project by project and the DG must explain why its taking 45 days and not 20 days to resolve this.”
The energy seminar, held under the theme “Advancing Renewable Energy: A Comprehensive Review of the IPP Procurement Process”, resolved to address issues including backlogs that undermine infrastructure development in the country.
It also highlighted the urgent need for intervention to address a number of challenges and risks, including the urgent finalisation of grid development and capacity allocation solutions to respond to the country’s future energy requirements.
It identified strategic stakeholder alignment across all the relevant departments as being important to reduce timelines and streamline processes within the confines of legal frameworks, in a bid to ensure the agility of the next procurement programmes.
It also focused on the redesign of the IPP procurement/auction model and economic development elements, to ensure that it keeps up with the challenges of a fast-changing industry and meets the requirements of the market.
“In the next two weeks we are going to make a major announcement on the National Transmission Company of SA, where once you have resolved the institutional projects, the question is what is next,” Ramokgopa said.
“The benefits are additional investment into the space because we have introduced competition. Over the passage of time benefits will be passed on to the end consumer.”
The IPP programme has thus far implemented more than 10.4GW of new generation capacity, including 7 335MW that is operational on the grid from 95 IPP projects.
There is at least 1 837MW that is currently in construction from 17 IPP projects procured from the most recent Renewable Energy Bid Window 5 and 6 and Risk Mitigation IPP.
“One of the reasons why we have not been able to build an industry on the back of the seven bid windows is the uncertainty in relation to the bid windows, the stop-start approach is not helping us build an industry,” Ramokgopa said.
Speaking at the same event, Deputy Minister for Electricity and Energy, Samantha Graham-Maré, said the department was also busy with a comprehensive review of the Integrated Resource Plan 2023 (IRP2023), which was poorly received by the sector when it was launched earlier this year.
“We have undertaken a comprehensive and inclusive review of the plan, based on the valuable inputs from a multitude of stakeholders and intend submitting the final IRP to Cabinet for approval before the end of the financial year,” she said.