New grid targets after reality bites Ramokgopa
• Electricity minister to present proposals for adjustments
• Benchmarks of 2022 set to be missed
The newly appointed electricity minister gave a strong indication on Thursday that the government is likely to miss its targets to end load-shedding as set out in the 2022 energy plan as reality hits home for Kgosientsho Ramokgopa.
Speaking to Business Day on the sidelines of President Cyril Ramaphosa’s annual investment conference, Ramokgopa said he would present his proposals for adjusting the targets of the plan to the cabinet within the coming weeks.
This is to ensure that “more realistic” targets are set regarding ending the energy crisis in SA, which has progressively worsened since 2008 when the power blackouts were first implemented by Eskom, he said.
“We can still stay on the ambitious side provided that there are certain interventions that are being done,” said Ramokgopa, who was drafted in from the infrastructure investment office in the presidency to stabilise the troubled power utility and push through the president’s 2022 plan to end load-shedding.
The energy plan, released by the government in 2022 to ease load-shedding, includes fixing Eskom and expanding and fast-tracking the state’s own renewable energy procurement processes.
Key targets set out in the strategic plan have been missed, Ramokgopa said, including onboarding 1,800MW of electricity output to the ailing grid through renewable energy sources by March this year. The plan also sets out the government’s intention to cut red tape that has made it difficult for Eskom to purchase the spares and equipment needed to perform maintenance and repairs at its ageing fleet of power plants.
The plan has been widely used by the government to allay investor fears that SA is determined to resolve the energy crisis, which often leaves households and businesses without power for up to 10 hours a day.
Since July 2022 the government has “signed project agreements for 19 projects from Bid Window 5 for 1,800MW of new capacity, and for six projects from Bid Window 6 representing 1,000MW”.
The update on the implementation of the plan, released in January this year, says the time frame for the authorisations has been reduced to 57 days for projects gazetted as Strategic Infrastructure Projects.
Ramokgopa has embarked since February this year on his task to reduce the severity of load-shedding and ultimately end the rolling blackouts.
Ramokgopa was attending the Investment Conference on Thursday where President Cyril Ramaphosa said that SA had exceeded the five-year-long investment target of R1.2-trillion with R0.31-trillion.
Meanwhile, Eskom’s board chair, Mpho Makwana, says the entity’s separate transmission company is set to be operational by the third quarter of this year.
The establishment of the National Transmission Company of SA (NTCSA), first announced four years ago, is expected to make it easier and more attractive for independent power generators to enter the market.
Speaking at the investment conference on Thursday, Makwana said the national transmission company is part of Eskom’s turnaround plan to restore a healthy energy availability factor and to end load-shedding by 2025 in line with the government’s energy action plan.
“We have a turnaround plan to ensure that ... we fast-track the creation of the transmission company so that ... we’re ready to implement, creating a competitive platform for supply and
demand of electricity,” Makwana said during a panel discussion.
The state-owned power utility’s board has previously said the process to be followed by the national energy regulator (Nersa) to allow the national transmission company to operate was expected to be concluded this month.
Eskom hopes to conclude the consent process with lenders by end-April.
Those approvals are all that remain for the legal separation of the national transmission company to become effective.
Ramaphosa announced the proposed unbundling of Eskom into three separate units — transmission, generation and distribution — in 2019.
A legally binding merger agreement, in which Eskom undertook to transfer its transmission division, was finalised in December 2021.
In the same month, it applied to the energy regulator for licences for the transmission, trading, and import and export of electricity.