- By David Lipschitz
In November 2008, the South African government announced Feed In Tariffs.
I was at the meeting in parliament, invited by two MPs whom I knew and who knew my interest in Renewable Energy. So I had the news first hand. I didn’t have to read it in the papers. I was there!
I was ready. And I put into action a plan to install roof-top solar for homeowners and SMEs (Small and Medium Sized Enterprises). I had a friend with an electrical business and I invested in his business to bring it up to speed with rooftop solar installs.
I also spent R200 000 on my system that I had already put over 1 000 hours of time into, and I took myself off to the USA in February 2009 for a month, for an additional R80,000 cost. I went to three conferences in Phoenix and Las Vegas, and I did a week long Grid Tie PV course and I wrote the NABCEP Entry Level Exam, which I passed. The same R200 000 system is about R70 000 today, and the learning has turned out to be priceless.
PV is Photovoltaic electricity, ie solar electricity from the sun.
NABCEP is the North American Board of Certified Energy Practitioners.
In 2009 the electricity cost in Cape Town was about 50 cents for homeowners, but it cost about R4 per kWh to make electricity from the sun using a Grid Tie PV system, ie a solar electric system without batteries. So a Feed In Tariff was required to pay the homeowner R4 per kWh to install systems. This price was R12 per kWh in 1991 when Germany implemented Feed In Tariffs and this price had already dropped from R12 to R4 between 1991 and 2009. In the meantime City of Cape Town electricity had grown from 1 0cents per kWh to 50 cents per kWh during this time.
By July 2012, we were at “Grid Parity” with City of Cape Town electricity at R1.58 per kWh and Grid Tied PV electricity without batteries at R1.58 per kWh. From 2009 till 2015, City of Cape Town electricity costs had risen by 3.16 times, whilst renewable energy costs had come down 60 percent!
And I came back from the USA rearing to go.
April 2009 arrived and the NERSA published the rules. Systems had to be above 1MW and there was no Feed In Tariff for PV! There was also no PPA, Power Purchase Agreement. And all the rules weren’t actually in place.
I put this behind me and carried on with investing and 6 months later, the government announced Feed In Tariffs of R3.96 for PV, but again above 1MW, and still no PPA.
I was devastated. My business ideas crashed and I went into a major depression.
I didn’t know that governments make announcements that they have no intention of implementing. Frameworks are put into place so the government can say “We have Feed In Tariffs”, but then rules are put in place to prevent the Feed In Tariff adoption. South Africa had 15 laws, 10 standards and 10 documents that had to filled in for “Feed In Tariffs.” By contrast the USA had two laws, one standard and one document! In the two years that South Africa had Feed In Tariffs, not one person got them!
I only discovered that governments make announcements that they have no intention of implementing two years later when I read the German politician, Dr Hermann Scheer’s book, The Solar Economy, and he said that Italy and other countries had done this. Italy and South Africa found excuses for not installing rooftop PV systems. And interestingly, Eskom benchmark themselves against Enel, the Italian Electricity Monopoly. One can see why this particular benchmark is chosen!
In 2011, the South African government said that Feed In Tariffs were a “mistake” and they introduced the Tender system. This was interesting as the UK government had the Tender system for 20 years and they had just announced that it had failed and they had changed to the Feed In Tariff system.
But an amazing thing happened to me from 2009 onwards. I was already an expert in South African Energy and Renewable Energy. I spoke at conferences all over South Africa. I spoke in parliament on behalf of the South African Alternative Energy Association (SAAEA) and they made me a lifetime honourary member for services to Renewable Energy in South Africa. I chaired conferences and debates. I wrote articles for newspapers and magazines and in 2015 I was interviewed on live TV, DSTV Channel 410, CNBCAfrica. So far I have been on their programme three times in two months.
And most recently I have been asked to write a weekly column for SA Breaking News, which I am delighted to do.
Note that as an entrepreneur I need to find the best in any situation. Whilst the South African government created and then killed Feed In Tariffs, they created a new life and business environment for me and many others, and for this I am grateful, as I pursue my dream of making the world a little bit of a better place each and every day I am here.
- David Lipschitz FSAAEA, computer scientist, mentor and energy analyst with a Bachelor of Science Honours and an MBA, has run a Software Development business since 1994 and an Energy business since 2008. David motivates people to change the way they think about their environment and shows people that it is possible to live a sustainable lifestyle with minimal impact on the earth. Keynote, conference and workshop topics include energy efficiency, load shedding, and producing electricity.
Image source: Flickr/ Global Panorama