Mining firms are working to produce 6.5GW of renewable power to supply their operations, but the Minerals Council SA says the energy regulator needs to speed up the registration process for independent power projects.
The 89 projects by 29 mining companies for their own use will produce energy equal to just more than six stages of load-shedding and decrease demand on SA’s ailing grid.
The government lifted the 100MW cap in July allowing the mining industry to accelerate more than R100bn in investment in hydrogen, wind, solar and battery projects, according to the Minerals Council SA.
But mines and other producers of energy must register their projects with the National Energy Regulator of SA (Nersa).
By August Nersa had registered over 500MW of private renewable power generation projects, with a pipeline of more than 6,000MW of projects awaiting registration. This was according to an August update from Operation Vulindlela, a joint initiative of the presidency and National Treasury to accelerate structural reforms.
The Minerals Council SA said in a statement on Monday that there had been encouraging progress from the government around the time it takes to register private renewable energy projects, access Eskom’s grid and relax granting of environmental permits, but there are still “unnecessary bottlenecks that are delaying investments”.
Business groups and the mining industry have already discussed the delays with the presidency and various government ministers.
SA moved to stage 6 load-shedding in the early hours of Sunday morning, removing 6,000MW off the grid with the situation expected to remain strained for the rest of the week.
Minerals Council CEO Roger Baxter called for the stabilisation of electricity supply, “while we in the private sector do what is necessary to get investment into ... developing alternative additional sources of electricity”.
“We know load-shedding will be a risk for the next two years, but we must continue to bring supplemental supply from the private sector on stream as quickly as possible,” he said.
There is no time frame for how many years it will take for mines to finish providing their own power as it depends on access to imported materials, as well as the time it takes to register the projects.
Mining production slumped for a sixth straight month in July, Stats SA announced last week, by more than economists had predicted.
This is due to weakness in the local and global economy, a strike in a the gold industry, supply chain bottle necks and load-shedding.
Mines, which are high energy users, need to reduce demand during load-shedding.
On Sunday, about half of Eskom’s generation capacity was offline, with 15,600MW lost due to breakdowns and 7,000MW offline for planned maintenance.
Eskom said on Sunday it wanted to buy 1,000MW of power from the private sector though it is not clear if that much is available.
Showing the urgency to find new sources of power, Eskom said it wants to sign the first power supply agreement during the course of this week, and for the power to start flowing as soon as possible. This means it is bypassing the usual regulation, costing and registration processes.
Correction: September 20 2022
This story previously said the cap had changed to 100MW for embedded projects. In July, President Ramaphosa lifted the cap from 100MW.
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