The mineral resources & energy department pared down the number of bidders in the latest round for the renewable energy procurement programme, a development that focused attention on the need to build more high-voltage power lines to carry wind, solar and other green energy over long distances.
Mineral resources & energy minister Gwede Mantashe, who had no kind words for Eskom at the signing ceremony, said only 860MW in projects — less than a fifth of what the department hoped to procure in bid window 6 — could be given the go-ahead “because there is no grid capacity to sign more on now”.
Transmission grid constraints in those provinces that hold the most potential for new wind and solar power projects, such as the Northern and Eastern Cape, could slow down the rollout of new renewable power projects that are needed to stabilise electricity supply and to fill the gap being created as Eskom retires old power stations, and for SA to meet its emission reduction targets.
Doubling the megawatts to be procured from wind and solar power in bid window 6 of the Renewable Independent Power Producer Procurement Programme (REI4P) from 2,600MW to 5,200MW was one of the major interventions announced by President Cyril Ramaphosa as part of the energy crisis response plan.
The plan was announced in July shortly after SA was, for the first time since 2019, plunged into stage 6 load-shedding. But due to Eskom’s transmission grid constraints the department could not even award the full original scope of 2,600MW.
On Thursday, Eskom and the department signed legal agreements with 13 projects under bid window 5 of the REI4P, which will together add 975MW to the national grid. The new generation capacity should be online from 2025, the department said.
To date the department has concluded 19 out of the 25 projects announced under bid window 5, which will add about 1,800MW to the grid. The six outstanding projects, representing another 800MW, are yet to be concluded.
At the signing ceremony, Mantashe announced five solar power projects that have been appointed as preferred bidders under bid window 6 which will install 860MW.
Mantashe said the department was also in discussions with the potential bidder on conditions for appointment to fill the remaining gap up to 1,000MW, which is to be procured for solar power in this bidding round.
Despite having received bid responses for 4,116MW of wind power, no new wind power projects could be awarded because there was not enough transmission grid capacity.
The projects are to be located in the Eastern Cape and Western Cape supply areas, but Eskom informed the department during an evaluation that no grid capacity was available to connect any proposed onshore wind projects in these supply areas.
The solar projects that were announced are located in the North West and the Free State.
Segomoco Scheppers, the head of transmission at Eskom, said that available transmission capacity was also being taken up by independent power producers (IPPs) that are making use of the opportunity created by the liberalisation of the sector and investing in generation capacity to sell to the private sector. This meant that those IPPs that were bidding for the REI4P programme now had to compete increasingly with IPPs that are developing projects independently.
The SA Wind Energy Association said it was “distressed at this absence” of wind power projects. “As the country struggles under stage 6 load-shedding, new generation capacity bid by the wind sector has been set aside […] This is despite government’s commitment to accelerate new generation capacity from renewable energy, which was escalated by the doubling of the wind allocation in bid window 6, from an original 1,600MW to 3,200MW,” Niveshen Govender, CEO of the association, said.
Govender was not convinced by the reasons given for not awarding bids to any new wind projects. The recently published Generation Connection Capacity Assessment clearly indicated grid availability in the provinces where wind projects were developed for public procurement, he said.
The assessment he referred to, published by Eskom, indicates that there is zero grid connection capacity in the Northern Cape, but there is between 1,600MW and 1,800MW capacity each in the Western and Eastern Cape and a separate area bordering all three Cape provinces, which Eskom refers to as the “hydra cluster”.
The report shows there is about 32,000MW of capacity to add new generation projects to the transmission grid.
Most of this is in Gauteng, Free State, KwaZulu-Natal and Mpumalanga, where Eskom has been running its own initiative to lease its land around existing power stations with guaranteed grid connection to independent power producers.
Eskom hopes to connect between 50,000MW and 60,000MW of variable generation capacity to the grid by 2030. But, as it has previously indicated, to do so it will have to spend R130bn to build 100 new substations and 8,000km of transmission lines.
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