Two more provinces have almost run out of space to connect more generation capacity to the national electricity grid.
Almost all available grid capacity has now been absorbed in the Free State and North West. This in addition to the Eastern, Western and Northern Cape, where the available capacity has been exhausted for some time.
This was disclosed on Wednesday during a presentation by the department of energy & electricity to its portfolio committee about the government’s independent power producer programme.
It comes after Eskom’s generation connection capacity assessment, published in October 2023, showed space for a further 20,000MW of generation capacity on the grid, available in the following provinces: KwaZulu-Natal (5,500MW); Gauteng (4,680MW); Limpopo (3,360MW); Mpumalanga (3,320MW); the North West (1,660MW); and the Free State (1,420MW).
The latest news means that no new independent power producer-generated electricity located in the regions where the sun and wind resources are at their best can loaded onto the grid until the National Transmission Company of SA starts to deliver on its ambitious grid expansion programme.
Locating them elsewhere, for example in KwaZulu-Natal or Mpumalanga, will result in lower yields, which would translate to higher tariffs for the electricity sold.
Environmental requirements are also stricter and approvals take longer, according to the department.
Some grid capacity may, in the meantime, be unlocked following energy regulator Nersa’s recent approval for congestion curtailment to be treated as a constrained generation ancillary service. There is, however, still no clarity about the rules for the allocation of grid capacity.
Private sector
The grid constraints have already affected the rollout of renewable energy projects with no wind allocations in bid windows 6 and 7 of the government’s renewable energy independent power producer procurement programme.
The National Transmission Company of SA through the transmission development plan provides for 14,000km of transmission lines and associated infrastructure to be constructed in the next 10 years.
The government is embarking on a programme to leverage private sector capacity to assist Eskom in the execution of the transmission development plan, but that will take time.
The department has begun with a pilot project for private sector companies to develop, design, finance, build, operate and/or maintain designated transmission facilities for the duration of a concession period, and subsequently transfer ownership to the National Transmission Company of SA.
A request for information was issued in December and will be followed by a request for qualification in July. A formal request for proposals is being planned for November. The pilot project is aimed at procuring 400KV transmission lines with associated transformation infrastructure, with a total estimated length of 1,164kms.
The committee heard that the programme had, since inception, attracted R292bn in investment, of which R52bn (18%) came from foreign investors. The main participating countries are Germany, Spain, France, Italy and the US.The department’s independent power producer office has run 12 bid windows.
A total of 7,615MW from 97 projects are already in operation, 3,168MW from 21 projects are approaching financial and commercial close, 157 preferred bidders have been appointed, representing a potential 15,797MW of generation capacity and 14 projects are under construction and will deliver 1,525MW.
A further 2,616MW are now in the market. That includes 2,000MW of gas-to-power generation and 616MW of battery storage.
The evaluation of the bids for the battery storage has been completed and energy & electricity minister Kgosientsho Ramokgopa will announce the preferred bidders on May 30.
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