After months of rolling power cuts, South African President Cyril Ramaphosa has declared a state of national disaster.

South Africa’s state-owned power company Eskom, which produces 90 per cent of the country’s electricity, is beleaguered with old and poorly maintained coal-fired power plants prone to breakdowns. It’s also around €23.7 billion in debt.

As demand outpaces supply, there have been scheduled blackouts - known as ‘load shedding’ - for up to 12 hours a day, impacting the lives and livelihoods of 60 million South Africans.

The nation is still largely dependent on fossil fuels, with only 7 per cent of its energy coming from renewables in 2020, according to the International Energy Agency.

So what does Ramaphosa’s announcement last week mean exactly, and could it hasten South Africa’s clean energy transition as well as resolve the immediate crisis?

What is a National State of Disaster?
The president has the power under the 2002 National Disaster Management Act to declare a crisis on this level if existing legislation cannot deal with the problem.
This gives the government powers to release resources to tackle the disaster, appoint people to provide emergency services and to bypass existing laws in the procurement and delivery of goods and services.
A cabinet member then oversees the process, heading up an intergovernmental committee to mitigate the disaster through co-ordination between national, provincial and municipal bodies and the National Disaster Management Centre. 

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dFinance Minister, Enoch Godongwana’s announcement regarding the launch of the National Treasury’s rebate scheme for new rooftop solar installations on private homes from 1 March 2023, has pushed demand for renewable energy solutions by homeowners – particularly solar panel installations.

According to Hermanus van der Linde, chief executive of short-term insurance broker Integrisure, the sudden rise of solar has led to some confusion among body corporates and homeowners associations (HOAs) in estates and complexes about the responsibilities of insuring the installations.

Van der Linde said that some body corporates and HOAs are not aware or have not been advised that they can cover solar panels under their existing building insurance policies, with minimal implications.

Others are not keen to take on the insurance themselves, leaving it the responsibility of individual owners to get insured.

For body corporates and HOAs, some of the options in the market are to insure a typical rooftop solar system or fixed generator by increasing the building sum insured with the replacement value of the system, which can be added to the Participation Quota (PQ).

“The system will be covered in full for typical building risks such as fire, hail, impact and accidental damage,” van der Linde said.

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Other cover options include increasing the power-surge and/or exterior theft first-loss limit to ensure that they are covered for all losses up to the chosen amount on a first-loss basis.

Another option that has been seen in the market is to add the solar system as a specified item with an additional premium payable, which includes full building cover without limitations on theft and power surge.

“In this instance, the system should be specified at full replacement value,” he said.

Those who live in residential estates or complexes need to obtain approval from body corporates or homeowners’ associations when looking to install solar.

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The rapid advancement of solar panels could cause a significant problem when a replacement is needed, as they must be compatible with the rest of the system, and sourcing the right panels can be challenging.

When a suitable panel can’t be sourced, it may mean that the entire system must be replaced.

This raises the question — how would insurance companies handle such an eventuality?

Auto & General Insurance and Momentum Insure told MyBroadband they would be willing to replace the whole system if a suitable panel couldn’t be sourced.

King Price said it would only be liable to pay out for the single panel.

MyBroadband spoke to AWPower’s managing director Christiaan Hattingh, who explained that finding a suitable replacement panel is often challenging if one is damaged or stolen.

He said one lost panel significantly impacts the performance of a solar installation as it “breaks the string”. Therefore it is essential to find a replacement.

“The amount of models that are being imported and supplied to us as installers changes so quickly,” he said.

“We did an installation two years ago, and about six months ago, the client had a panel stolen off his roof. One of them got stolen.”

“We couldn’t find the same model. You can’t just mix and match different panels with each other,” Hattingh added.

He said it is possible to deviate by five or ten watts if the panels are similar. However, you can’t, for example, replace a 460W with a 550W panel.

Hattingh said some solar panel producers release a new model almost every month or two, and they often aren’t compatible with clients’ existing systems.

“To keep up with that is very difficult. For people that have a faulty panel two years down the line or have one stolen, as in our case, to find a replacement is very difficult,” he said.
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​Despite the difficulty, AWPower eventually found a suitable replacement for the client.

“Luckily, in our case, the customer’s insurance company paid for the panel with installation. We could find the correct panel for the customer to replace the stolen one,” Hattingh said.

MyBroadband asked King Price, Auto & General, and Momentum Insure how they would approach such a scenario.

Head of Auto & General Ricardo Coetzee said the company would do its best to find a similar panel. However, he said it would have to look at replacing them all if it couldn’t.

“We would do our utmost to find a similar panel. If we are unable to do so, we would need to replace all relevant hardware to provide the customer with a fully operational and like-for-like system,” Coetzee said. 

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South Africans have been battered by power shortages for several years. These have worsened to the point that towards the end of 2022 the country’s electricity utility, Eskom, had only half of its power generation capacity operational.

This has forced Eskom to escalate its rotational power cuts. By mid-January 2023, users were typically without electricity for 8 to 10 hours a day.

The situation is unlikely to improve much in the short to medium term.

It’s expected that this year, especially as power demand increases in winter, the country’s electricity supply will decline to the point where power may sometimes be available for only 12 hours a day.

Nor is the situation expected to improve in the medium to long term. The national electricity utility is in a precarious financial situation.

The result is that South Africans are increasingly being forced to explore alternative sources of electricity.

From big companies down to small households, entities are even considering whether it is possible to disconnect from the Eskom grid entirely and produce all their electricity in-house.
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Fifteen years ago South Africans had access to abundant electricity at some of the cheapest pricing in the world.

But since then electricity tariffs have skyrocketed at an average of four times the inflation rate.

Factories, mines, farms, businesses and individuals are now choosing to reduce their dependence on Eskom’s network by supplementing their electricity with in-house power generation.

While this lowers demand on the Eskom power supply, the level at which this has been happening so far is insufficient to substantially reduce power cuts.

The construction of larger private solar plants, already initiated by some bigger entities, as well as the growing interest in rooftop solar in residential areas, will gradually be felt. But this too will not stop power cuts completely.

Some entities may go as far as cutting themselves off from Eskom entirely. How feasible is this?

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President Cyril Ramaphosa says that the government is pulling on every resource it has to get power onto the grid as a matter of extreme urgency.

However, he said that the ‘energy action plan’ – announced six months ago – could not be implemented overnight and that measures would take time to yield results.

Writing his weekly letter to the public, Ramaphosa said that load shedding in the country is a result of a ‘perfect storm’ of various factors hitting all at once, including a lack of investment in new generating capacity, poor Eskom power plant maintenance, corruption, criminality, sabotage, rising debt and a lack of skills.

However, he acknowledged that South Africans no longer want to hear excuses.

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In an attempt to fight back the onslaught of rolling blackouts, Ramaphosa said that Eskom’s singular focus is improving plant performance – while the government is also trying to find sources of new generating capacity.

One major source of new generation is rooftop solar panels on houses and businesses, he said.

Ramaphosa said that work would soon be completed on a pricing structure that will allow customers to sell surplus electricity from rooftop solar panels into the grid.

“To incentivise greater uptake of rooftop solar, Eskom will develop rules and a pricing structure – known as a feed-in tariff – for all commercial and residential installations on its network.”

Designated local content for solar panels has been reduced from 100% to 30% to alleviate constraints.

On Sunday (22 January) Eskom chair Mpho Makwana also noted that rooftop solar was one of the various strategies the power utility was looking to leverage to help mitigate the crisis.

Makwana said that plans around the rollout of rooftop solar are expected to be detailed in the coming weeks.

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UN Climate Change News, 18 January 2023 – The uptake of renewable energy is moving faster and further than projected but radical action is still needed to accelerate the energy transition.

Speaking at the International Renewable Energy Agency (IRENA) Assembly in Abu Dhabi last weekend, Stiell said the positive outcomes from last November’s UN Climate Change Conference COP27 give the world enormous opportunity to make progress, starting now.

“It requires the cooperation of every single country represented in this room,” said Stiell. “All Parties must come together in order to achieve the level of ambition needed to get to where we need to go, and we have a lot of work to do to get there.

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​There is reason for optimism when it comes to renewable energy because renewables are moving further and faster than projected. Here are just a few examples:

Renewable electricity capacity additions have been outpacing those of non-renewables since 2014.
 
The International Energy Agency’s (IEA) Renewables Outlook complements this, noting that renewables are set to account for over 90% of global electricity capacity expansion in the next five years and that renewables will become the largest source of global electricity generation by early 2025, surpassing coal.
 
In Europe alone, the IEA estimates that the continent’s renewable electricity expansion will double over the 2022-2027 period as energy security concerns add to climate ambitions.
 
Worldwide renewable energy employment reached 12.7 million last year, a jump of 700,000 new jobs in one year. Solar energy was found to be the fastest-growing sector. In 2021 it provided 4.3 million jobs, more than a third of the current global renewable workforce.

But there is also reason for frustration. As IRENA pointed out in its submission to the global stocktake, regardless of increased ambition expressed by countries at the last two COPs, current climate pledges and overall finance to support the shift to renewables remains insufficient.

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South Africans renting a home may risk losing their investment in the backup power systems they’ve installed if they fail to consider an addendum with the landlord to remove the installation upon the termination of the lease agreement.

South Africa’s power grid is under significant strain due to a combination of factors, including population growth, increased demand for electricity, poor management and ageing infrastructure.
This strain has led to frequent power outages and load shedding, which has had and continues to have a major impact on the country’s economy and the daily lives of every South African.

According to Daily Investor, the Council for Scientific and Industrial Research (CSIR) senior researcher Monique le Roux said the South African economy lost R560 billion because of load shedding in 2022, and things are unlikely to change in the next few years.

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She added that although it is hard to predict the future, another ten years of load-shedding is a possible scenario.

As of Tuesday (10 January 2023), power utility Eskom announced that load shedding will be pushed to stage 6. The pattern of stage 4 load shedding between 05h00 and 16h00, and then stage 6 between 16h00 and 05h00 will repeat until further notice, Eskom said.

Prolonged load shedding and the prediction that it will remain a reality for South Africa long into the future has meant that many South Africans have decided to install backup power supply to their properties to mitigate the effects of having no power at home for extended periods.

Additionally, almost all major banks now offer loans to provide finance to their customers specifically for backup utilities due to their expense – whether it be generators, batteries, or renewable energy sources such as solar.

However, TPN Credit Bureau warned those renting properties to consider South Africa’s property laws before installing any backup utilities.
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South Africa’s largest solar power plant is the Solar Capital De Aar Project in the Northern Cape.

The photovoltaic (PV) facility has an installed generating capacity of 175MW, enough to provide electricity to roughly 75,000 homes per year.

It consists of more than half a million PV modules covering 473 hectares.

The project was split into two construction phases, with the first finished in August 2014 and providing 85.26MW of capacity.

The second phase added another 90MW of generating capacity about two years later.

Overall, it took 28 months to construct the entire facility at a cost of R4.8 billion.

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mybroadband.co.za/news/energy/476185-biggest-solar-plant-in-south-africa-vs-the-world.html​While its capacity is substantially larger than the numerous 50-100MW solar plants across the country, it pales in comparison to the biggest solar farms in the world.

At the time of publication, the largest solar plant globally was Bhadla Solar Park in India, with an installed capacity of 2,245MW, nearly 13 times that of Solar Capital’s De Aar plant.

The plant is built in a desert considered to be nearly uninhabitable.

Its peak daily temperatures range between 46-48°C, and it frequently gets battered by hot winds and sandstorms.

But its hot and largely cloud-free conditions make it perfect for generating solar power.

Bhadla’s construction began in March 2015, with four phases completed by March 2019.

It now comprises over 10 million solar panels and spans an area of roughly 5,700 hectares.

When the conditions are right, it can produce more power than Koeberg nuclear power station at full load or about half of Medupi’s generating capacity.

Plans are in place to expand its capacity to 3,500MW in the future.

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South Korean Automotive behemoth Hyundai is now running its head office in Bedfordview and dealerships across Gauteng on solar power in an effort to combat load shedding.

According to the group, the head office now has more than 240 solar panels on the roof, delivering 110 kW on a day with normal levels of sunshine. This set the group back a combined R14 million following their installation.

“Due to the frequency of power interruptions brought about by load shedding and the cost of running diesel-burning generators, we investigated the benefits of installing solar power,” said Stanley Anderson, sales and operations director at Hyundai Automotive SA.

After the installation, the group can change to smaller diesel generators. “The cost of diesel and running a generator was also a big consideration when we investigated the installation of the solar power systems,” Hyundai said.

Anderson added that the project also aimed to reduce the electricity bill and consumption of the company and its dealer network while making it more environmentally friendly.

The head office is now looking to install batteries to store power better.

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e are busy with a feasibility exercise to see what the most cost-efficient solution would be to install batteries in order to store power, which would considerably reduce the use of a generator,” said Anesh Parhanse, the general manager of properties at Hyundai Automotive SA.
Parhanse said that the group does not yet store power at the main office, but power is let back into the grid when there is a surplus.
All installations are grid-tied and generator-tied. When there is load shedding and not enough sunshine, the generator will kick in, Parhanse added.
“Between 10h00 and 15h00 we are off the Eskom grid 90% of the time when there is enough sunshine. On a bright sunny day with clear skies, we are off the grid completely.” 
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