Eskom ‘backs renewable energy’

Eskom has struck back at suggestions that it is against renewable energy supply initiatives, dismissing media reports to this effect as inaccurate, malicious and mischievous.

This follows reports that a multimillionrand Nelson Mandela Bay company, the Coega Industrial Development Zone-based DCD Wind Towers, is facing potential closure as a result of Eskom’s delay in signing off a raft of new renewable energy projects worth about R50-million.

The power utility has been dogged by claims that it has intentionally delayed authorising new power purchasing agreements (PPAs) for a number of reasons.

One was that it had lost billions of rands in revenue as a result of renewable energy projects introduced into the country and was rather focusing its efforts on its controversial new nuclear build.

Responding yesterday to questions about its renewable energy programme and how the delay in signing off projects was affecting participants in the renewables sector, Eskom spokesman Khulu Phasiwe said it recognised the role renewable energy played in decarbonising South Africa, creating jobs and attracting foreign investment to the country.

“To this end, Eskom supports the introduction of renewable energy independent power producers as envisaged in the government’s Renewable Energy Independent Power Producers Programme (RE-IPPP).

“Eskom has signed 64 PPAs for a total of 4 000MW under the RE-IPPP programme and two PPAs for the open-cycle turbines for [more than] 1 000MW.

“In addition to the signed PPAs, there are 2 383MW of renewable PPAs remaining to be signed – 39 contracts – which have been approved by the Eskom board’s investment and finance committee, and for which approvals have been received from the Minister of Public Enterprises.

“Nersa [National Energy Regulator of SA] has provided assurances for cost recovery of these PPAs.”

Phasiwe said Eskom’s main objective was to deliver reliable energy supply at the least cost.

“The notion that Eskom is against renewables is inaccurate, malicious and mischievous,” he said.

“Eskom’s position is that all energy sources should be pursued at a pace and scale that the country can afford.”

Addressing the issue of the billions renewables had allegedly cost the power utility, Phasiwe said the company had spent R9-billion last year to buy renewable power at an average cost of 218c/kW.h.

“The entire 218c/kW.h is passed through to the consumer and is blended into the Eskom selling price of 83c/kW.h,” he said.

Eskom has proposed a new funding structure for renewable energy initiatives.

One of the benefits of this would be that consumers would be protected from unnecessarily high electricity tariffs.