This is according to experts who spoke to Sunday newspaper Rapport about President Cyril Ramaphosa’s surprise announcement on Thursday that private companies and individuals will now be allowed to build generating projects of up to 100MW in capacity without a licence from the National Energy Regulator of South Africa.
The president said while measures taken by Eskom to maintain its ageing infrastructure and increase electricity availability in the county were positive and necessary, they were not enough to address the immediate and significant energy shortfall in the country.
“Incremental measures will not be sufficient to meet the scale of this challenge,” Ramaphosa said.
“This intervention reflects our determination to take the necessary action to achieve energy security and to reduce the impact of load-shedding on businesses and households across the country.”
Ramaphosa said this would also remove a significant obstacle to investment in embedded generation projects.
“Generators will also be allowed to wheel electricity through the transmission grid, subject to wheeling charges and connection agreements with Eskom and relevant municipalities.”
Cyril Ramaphosa South African President
Intellidex’s capital market investments head Peter Attard Montalto estimated that the investments could add a further 15,000MW of generating capacity.
To put this into perspective, Eskom currently has around 45,000MW of generating capacity.
The additional capacity would be roughly equivalent to the total supply which has been unavailable in recent days due to breakdowns of generating units and planned maintenance.
Eskom’s most recent load-shedding update on Friday showed the utility had 13,625MW of capacity unavailable due to breakdowns, while, 1611MW was offline for planned maintenance.
North-West University political analyst Piet Croucamp told Rapport the decision was made after a number of businesses and groups had met with the president at the Union Buildings over the past few weeks.
This included African Rainbow Capital’s Patrice Motsepe, mining groups, and Business Unity South Africa.