Industry has voiced its support for the draft renewable energy master plan that was published by the department of minerals & energy earlier this week.
The master plan’s focus is on building local value chains for renewable energy and battery storage, rather than on setting the pace for the rollout of renewables. Its objectives include expanding the industrial capacity in the renewables value chain, job creation, skills development and transformation of the industry.
The draft plan does not include localisation targets, but does highlight the need to adopt a “realistic, yet ambitious, trajectory for ramping up localisation, with yearly (or biennial) targets”.
“Such a ‘ramping curve’ should be in line with market realities in terms of existing industrial capacity, demand and lead times for industrial investment,” it says.
“Together with the broader renewable energy industry, we welcome this framework, as it supports our advocacy for sector industrialisation through increased local manufacturing,” said Niveshen Govender, CEO of the SA Wind Energy Association (SAWEA).
The plan suggests “effective interventions to create a better environment for local manufacturing”, which will result in new investment and job creation, Govender said.
Value-chain approach
According to the master plan, the contribution of renewable energy to electricity generation in SA increased from less than 1% in 2000 to almost 7% in 2022.
Existing polices such as the Integrated Resource Plan of 2019 (IRP2019) and the rapid increase in of private sector investment in large-scale renewable projects will exponentially increase the rate at which new renewable energy projects are added in SA. Together, these already account for about 35GW of wind and solar energy to be added by 2030. However, in its energy planning recommendations, the Presidential Climate Commission (PCC) points to the need to roll out between 50GW and 60GW of renewable energy by 2030.
This huge push towards renewables should be used to “to unlock the industrial and inclusive development of associated value chains in the country”.
One of the strengths of this draft plan was that it took a value-chain approach, said Brian Day, chair of the SA Independent Power Producers Association (SAIPPA).
Speaking at the Coal & Energy Transition Day hosted by Resources for Africa in Johannesburg earlier this week, he said the master plan was “not just about building large projects” such as manufacturing capability to produce wind turbines. Instead, the plan focused on “building value chains to support industrialisation [in the renewables sector]”.
At the same event, Santosh Sookgrim, senior technical adviser at SAWEA, said to achieve a rapid rollout of renewable energy it was not feasible, in the short term, to rely on the establishment of local facilities to manufacture wind turbines, for example.
Together with the broader renewable energy industry, we welcome this framework, as it supports our advocacy for sector industrialisation through increased local manufacturing.
— Niveshen Govender, CEO, SA Wind Energy Association
“We need the power on the grid now, and only way to do that is to bring these machines into the country,” he said.
However, he said, as the draft plan implies, “instead of looking at localisation only from the perspective of when and if SA will be able to manufacture [wind] turbines”, the industry will look at other manufacturing that is needed to support the uptake of renewables.
This could include the manufacture of large trailers that are needed to transport wind turbine components from ports to where the plants will be set up.
The plan also calls for “a clear picture of both public and private sector-led demand over the next years”. To this end, an update on the pipeline of both public and private procurement for renewable energy and storage technologies in SA should be published quarterly.
Some enablers for industrialisation in the renewables sector identified in the master plan include the development of “clear, consistent and enforced bidding rules and timelines” for the public procurement of renewable energy, and a need to expand infrastructure such as the transmission and distribution networks that are needed to connect renewable plants to the grid.
The document points out that the national grid has significant availability constraint in some areas, offering limited to no grid capacity in the Cape provinces, which offer the best renewable energy resources. The remaining grid capacity (22,754MW, mainly in KwaZulu-Natal and Mpumalanga) is expected to be rapidly used. The distribution network is further in dire condition, with a significant maintenance backlog nationwide, the master plan said.
The submission period to comment on the plan closes July 31.
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