- Eskom General Manager for primary energy Dan Mashigo, says that the state-owned energy utility has a 20 gigawatts (GW) new generation project pipeline made up of 6GW of solar PV, 4GW of gas power, 3GW nuclear energy (which includes small modular reactors at coal fired power stations), 3.5 GW of hydro power and 4GW of wind/energy storage hybrid projects.
- He was speaking on behalf of Eskom CEO Dan Marokane at the 6th edition of the Coal & Energy Transition Day, revealing Eskom’s perspective on coal and alternative energy sources and the roles they will play in the future energy mix of South Africa.
- He said that coal generated power will fall from 83% of total capacity in 2025 to 48% of 54 GW generation capacity projected for 2035.
- He added that by 2050, Eskom would only have three coal power stations operational namely, Medupi and Kusile and Majuba.
- The three power stations have a combined capacity of 13.5 GW and will represent less that 25% of generation capacity at that time.
While Mashigo was mum on how the projects would be funded as Eskom has unsustainable debt more than R400 billion, the new government of national unity (GNU) appears to be alligning energy sector stakeholders to unlock funding under the so-called Just Energy Transition Partnership, with Eskom as one of the beneficiaries.
South Africa’s GNU re-aligning to unlock JET funding
At COP 26 in November 2021, the governments of South Africa, France, Germany, the United Kingdom and the United States of America, along with the European Union, issued a Political Declaration announcing a new ambitious, long-term Just Energy Transition Partnership (JETP) with a combined pledge of US$ 8,5 billion in funding. The International Partners Group (IPG) as it is called, aims to accelerate the decarbonisation of South Africa’s economy to help it achieve the ambitious goals set out in South Africa’s updated Nationally Determined Contribution emissions goals.
Late last year, the South Africa’s Cabinet under the ANC led government approved the Just Energy Transition Implementation Plan but this was delayed by faction infighting within the party culminating in outgoing environment minister, Barbera Creecy, announcing that government would allow five coal power stations to exceed minimum emissions standards. Read more
Related news: Additional US$3.5 billion pledge for South Africa’s JET plan but pushback from labour and energy minister remain
Last week South Africa’s National Treasury, in partnership with the Presidential Climate Commission, the World Bank, and a range of partner organisations last week hosted the Climate Resilience Symposium in Pretoria which aimed to integrate climate goals into macro-fiscal and finance policy. In his closing remarks at the Symposium, South Africa’s National Treasury Director General, Dr Duncan Pieterse, provided updates on JET Programme and carbon credit trading.
“It was noted that international support for South Africa’s just transition through the JETP programme has been encouraging, but challenges remain, including low levels of grant availability and expectations for sovereign guarantees in the support linked to State Owned Entities (SOE”s) and municipalities. We will therefore continue to work closely with our development partners to increase the scale of concessional funding, and to make sure that the terms of the funding and the risk appetite of the lenders is in line with the capacity of our municipalities and SOEs,” said Pieterse. Read more
Related news: Eskom plans to build their own renewable energy plants next to coal fired power stations
On the weekend, South Africa’s new Environment Minister, Dr Dion George, has assured of South Africa’s commitment to meeting its undertakings under the United Nations Framework Convention on Climate Change (UNFCCC) and its Paris Agreement. These include the need to finalise the rules around carbon markets, adaptation indicators, the Just Transition Pathways Work Programme, the Mitigation Work Programme, and the new collective quantified goal (NCQG) on finance. George said South Africa is focused on implementing ambitious actions to reduce greenhouse gas emissions, including through the Just Energy Transition Investment Plan (JET-IP). He was speaking at the Brazil, South Africa, India and China (BASIC) Ministerial Meeting held on Sunday, ahead of the 8th Session of the Ministerial Meeting on Climate Action (MoCA) taking place in Wuhan, China. Read more
Yesterday, South Africa’s President, Cyril Ramaphosa, signed into law the Climate Change Bill which sets out a national climate change response, including mitigation and adaptation actions, which also constitutes South Africa’s fair contribution to the global climate change response.Read more
Flawed IRP
Outgoing energy minister, Gwede Mantashe, tried to gazette a grossly flawed integrated resource plan (IRP) before national elections in May and the subsequent forming of a government of national unity. Read more
The IRP needs to align with Eskom’s and the country’s energy ambitions plus criteria set and agreed upon by the JETP partners to unlock funding. South Africa’s new energy minister, Dr Kgosientsho Ramokgopa, has the unenviable task of fixing the mess Mantashe left at the energy ministry which includes revising the IRP plus capacitating the Independent Power Procurement Office (IPPO) which has failed to procure new generation capacity properly and timeously. Read more
Yesterday, Mashigo assured that Eskom’s generation ambitions will be aligned with generation allocations set out in the new IRP. He did elaborate on how the new capacity would integrate with the country’s power transmission plans.
Transmission readiness
As of 1st July 2024, the new National Transmission Company of South Africa (NTCSA) officially started to operate as a separate and independent entity from Eskom with its own newly appointed board. They have wasted no time in setting up a 101 Panel Transformer contract which will be used to procure approximately 34 transformers that are part of a priority program to modernise the country’s grid. The various companies will compete for various batch orders of transformers. The first batch order of 26 transformers is expected to be placed by July 2024 and will enable the delivery of approximately 28000MW to the grid by the 2028 financial year.
Segomoco Scheppers, acting CEO of NTCSA confirms that the aim is to connect 53GW of new generation capacity over the next ten years. To achieve this, innovative project delivery models and partnerships are being explored and implemented to drive accelerated delivery of the Transmission Development Plan (TDP), including a priority programme for strategic projects. The NTCSA is also actively seeking public/private partnerships to roll out more than 1500 km of new transmission lines annually over the next ten years.
Author: Bryan Groenendaal
