In light of ongoing power supply disruptions, the South African mining industry has taken an accelerated approach to power generation, with 73 projects currently in the pipeline that aim to bring up to 5.1 GW of electricity online. Undertaken by 24 mining companies, the projects come at a time when the South African government is taking urgent action to reform the power sector and bring new capacity online.
Last week, South African president, H.E. Cyril Ramaphosa, provided details into the government’s five-step action plan that aims to directly address the energy crisis and end load shedding for good.
In the address, the president emphasized the role the mining sector will play while introducing key interventions that will fast track project take-off and completion.
“As part of addressing the shortage of megawatts, Eskom will now also purchase additional energy from existing private generators such as mines, paper mills, shopping centers and other private entities that have surplus power,” H.E. President Ramaphosa stated.
Meanwhile, to ensure the widespread and rapid adoption of renewable energies, H.E. President Ramaphosa has introduced reforms including doubling new generation capacity procured through Bid Window Five of the Renewable Energy Independent Power Producer Procurement program for wind and solar from 2,600 MW to 5,200 MW; removing the licensing threshold for embedded power generation; and establishing a single point of entry for all energy project applications.
According to H.E. President Ramaphosa, “One of our greatest challenges in adding capacity to the grid is the time that it takes for any energy project to receive the necessary approvals and commence construction. The process, from design to commercial operation, has tended to take more than three years due to lengthy regulatory processes and red tape. We will therefore be tabling special legislation in Parliament on an expedited basis to address the legal and regulatory obstacles to new generation capacity for a limited period.”
South African mining-industry employer organization, Minerals Council South Africa, commends the approach taken the government, emphasizing that the regulatory processes that took up to three years to approve projects delayed progress by the private sector, “but President Ramaphosa’s commitment to cut red tape, develop a ‘one-stop shop’ for renewable energy project applicants, ease the local procurement rules and bring a level of pragmatism to the environmental authorizations are important developments that must be implemented with a degree of urgency.”