Radebe warns of defection from power grid
Decline in demand worries minister
Higher power prices and unreliable supply will push municipalities toward renewable energy‚ energy minister Jeff Radebe has warned. Municipalities are keen to generate their own power‚ though on a small scale‚ the energy minister said in his keynote address at the 2019 Africa Energy Indaba yesterday.
“As wholesale electricity tariffs rise‚ or as we fail to provide electricity for the residential sector‚ we can expect more rooftop photovoltaic (PV) solar systems‚ bio-gas waste to energy‚ and wind turbines to be installed at municipal level‚” he said.
Eskom is seeking annual tariff increases for the next three years of 17.1%‚ 15.4% and 15.5%‚ respectively‚ as it struggles to keep the lights on and pay off a more than R419bn debt burden.
Finance minister Tito Mboweni is expected to announce a bailout for the utility in his budget speech today. Earlier this month‚ President Cyril Ramaphosa announced the entity would be unbundled into three business units in a bid to secure its future sustainability.
But Eskom is also suffering the effects of its death spiral – where increasingly affordable alternative power technologies are encouraging consumers to defect from the national power grid.
“We need to arrest the steady decline in electricity demand over the past few years‚ and the lower economic activity coupled with rising electricity tariffs‚ that has tended to put Eskom into an untenable situation‚ characterised by increasing debt and increasing tariffs‚” Radebe said. Asked what the key priority for his ministry was‚ Radebe said it was clearly job creation. “Energy can play a catalytic role in improving economy growth‚” he told delegates. Labour unions have decried increased uptake of renewable power because of the resultant job losses in the coal sector. Radebe said another top priority was to finalise the longawaited Integrated Resource Plan (IRP)‚ which would determine SA’s energy mix into the future. The draft document proposed a reduced reliance on coal-fired power with wind and solar‚ supported by gas‚ seen as the preferred “least-cost option”. There have been calls from environmentalists for coalfired power to be scrapped from the IRP altogether. Radebe‚ however‚ said coal still played a significant role in the economy‚ although he conceded that South Africa still needs to move towards cleaner
energy. –