- Minister in the Presidency for Electricity, Dr Kgosientsho Ramokgopa, co-hosted the South African Transmission Financing Seminar with the Johannesburg Stock Exchange (JSE) last week, where experts and stakeholders from the energy and financial sectors shared key insights on the financing and development of South Africa’s electricity transmission infrastructure for sustainable energy security in South Africa.
- Unlocking funding will involve full or part privatisation of the sector but the government is reluctant to relax state control over transmission infrastructure.
- The lack of transmission capacity in the country will become more apparent in about six to twelve months said Ramakgopa.
The development and expansion of South Africa’s electricity transmission infrastructure is critical to enable diverse energy generating sources-which are geographically located in various parts of the country – to contribute to the country’s electricity grid.
Minister Kgosientsho Ramokgopa highlighted the requirement of transmission infrastructure expansion. The Minister further shared the transmission expansion plan and the subsequent planned major projects alongside key challenges facing transmission.
Key among these challenges is the financing and funding gap that’s required to fulfil transmission infrastructure development. Insufficient investment in the transmission system, government’s financial constraints, and governance deficiencies have resulted in Eskom delaying investment in the maintenance, refurbishment and expansion of the national grid infrastructure.
An estimated amount upwards of R 250 billion is required to fund the expansion of South Africa’s grid but the government does not have the money. At the same time government wishes to own and control the planned transmission infrastructure under its newly formed National Transmission Company (NTC).
The new NTC head, Mr Segomoco Scheppers, has confirmed that the country needed to add more than 1500 km of new transmission lines annually over the next ten years. This is to ensure transmission capacity to accommodate more than 50 GW of new generation power which will mainly come from intermittent renewable energy (wind and solar projects).
Currently, Eskom’s transmission division is adding 300 km of new power lines annually. Scheppers confirmed that in the last ten years, only 4 347 km of new powerlines were added.
Another challenge is transformer capacity. Scheppers confirmed that more than 122 600 MVA transformation capacity would have to be added, representing 77% of Eskom’s current installed base of just over 160 000 MVA. In the last ten years, only 19 060 MVA has been added to the grid infrastructure.
Central to the discussions were how to protect the country’s long-term socio-economic interests while balancing sustainability obligations and international commitments to climate change and decarbonisation.
The key thematic aspects addressed the synergising of private sector and government collaboration, the options and size of available financial resources, as well as international insights to build local resilience, capacity, and expertise.
Although not yet pronounced – a lack of transmission capacity will become more apparent in about six to twelve months said Ramakgopa. “The similar amount of effort we place on the generation side requires that they also be placed on the transmission side,” he added
The electricity minister confirmed that a plan to support the expansion of South Africa’s transmission network is expected to be presented to Cabinet next month.
Author: Bryan Groenendaal