- Local renewable energy Independent Power Producer (IPP), Earth & Wire, is fast-tracking their large-scale project development and grid connection to shore up South Africa’s flailing energy system.
The company’s ten-year strategic development plan has put them in the unique position to install over 2GW of blended wind and solar power to supply private off-takers and consumers with electricity over the next four years… and more than 20GW over the next fifteen years. They have already secured over 400,000 hectares of signed agreements with land owners across South Africa.
This land will provide enough solar and wind capacity resources to produce the power required to meet the company’s 2035 target of 30 percent of SA’s new energy capacity. The team has concentrated on land in the Eastern Cape RED Zone, as well as sites in the Western Cape, Free State, Gauteng and Mpumalanga that provide excellent energy resources, with – vitally – available grid access.
Thomas Garner, Earth & Wire’s Business Development Head says: “Earth & Wire has over 2 GW of late-stage wind and solar (with grid connections) that we will bring onto the national grid. These projects are located in the Eastern Cape, Gauteng and Mpumalanga regions. Importantly, the projects in Mpumalanga are ideally located for us to make a meaningful impact on the transition from coal to renewable power .”
He argues that Earth & Wire’s project deployment (as well as those of other IPPs seeking to sell to private offtakers) could be immediately accelerated if the regulatory environment catered for projects proceeding in the absence of power purchase agreements (PPAs).
A recent reform enables distributed generators to build facilities of up to 100 MW in size without a licence, as well as to sell to multiple third parties and to wheel electricity over municipal and Eskom networks. However, the National Energy Regulator of South Africa still requires such projects to submit signed PPAs as part of a compulsory registration process.
Should this registration requirement be eliminated, Garner believes that between 5 GW and 10 GW of new IPP capacity could be built in the coming two years and begin supplying private consumers that are not keen to enter into multidecade PPAs.
Brett Levick of WaterBorne Capital says, “We have been in discussions with international funders, investors and financial institutions on a pro-active search for the disruptive capital required to fund Earth & Wire’s roll out. To meet the business’s aggressive targets, Earth & Wire will require in the region of ZAR500 billion of investment capital over the next 15 years. This is a large number by any means, but certainly not out of reach, given the extent of the impressive Earth & Wire portfolio, their land assets secured for development, and the quantum of renewable power urgently required by the South African energy market.”
Bruce Paynter, Earth & Wire’s head of Brand Strategy points out: “South Africans are conditioned to think that they are powerless in the face of the energy crisis in this country. Our mission is to offer all South Africans the choice to buy reliable and affordable, clean electricity, from Earth & Wire, by 2025. We are also committed to making a positive and measurable socio-economic impact with goals and targets against which we will report.”
“It’s a promise we intend to keep,” concluded Paynter.
Author: Bryan Groenendaal