South Africa’s Energy planning and development is managed primarily by the The Department of Mineral Resources and Energy (DMRE).
Their plan for development in the energy sector, is guided by the Integrated Resource Plan or IRP. IRP provides the outlook of electricity demand and anticipated growth, together with what energy generation sources should be procured to meet that demand. It furthermore deals with the generation capacity, timing, and cost of these projects.
The IRP is an electricity infrastructure development plan based on least-cost electricity supply and demand balance, considering security of supply and the environment (minimize negative emissions and water usage).
Additional Capacity Required for Economic Expansion
The IRP envisages a total addition to electricity capacity of 29,500 MW by the year 2030, led by renewable procurement of 14,400 MW from wind and 6,000 MW from solar photovoltaic.
In order for South Africa to move its economy out of its current low growth pattern, there needs to be a seismic shift in both policy and an enabling environment. These will ensure the country can attract foreign investment and development initiatives. For this to become a reality, the country must provide enough energy and infrastructure, such as rail and port facilities that work and policy that does not inhibit mass employment, to ensure long-term investment programs.
Looking at the current electricity generation numbers released today by Stats SA, it appears that this goal is still a long way off and the procurement of renewable energy from Independent Power Producers is still running as a small percentage of overall production.
Current Energy Generation Decreasing
Current total Energy generation, as of November 2024 (latest Statistics available), stands at 19 694 GWh which is down from 21 524GWh in June, a decrease of – 9%.
While electricity generation (production) increased by 6,6% year-on-year in November 2024, this must be seen in context of severe load shedding that was still prevalent last November.
Seasonally adjusted electricity generation also saw a small increased of 0,8% in November 2024 compared with October 2024. This followed month-on-month changes of -1,1% in October 2024 and 1,4% in September 2024. Seasonally adjusted electricity generation increased by 0,8% in the three months ended November 2024 compared with the previous three months.
On the electricity consumption side, this saw an increase of 2,7% year-on-year in November 2024, With seasonally adjusted electricity distribution increasing by 0,1% month-on-month in November 2024, following month-on-month changes of -1,2% in October 2024 and 0,2% in September 2024.
Longer Term View Concerning
For a longer term perspective of energy generation in South Africa, when you take a 15-year look at generation the picture is even more bleak. Generation total output was at 22 000 GWh in 2008 and again in the 2011/2012 period. In comparison, the overall generation today, including the additional Independent Power Producers (IPP’s), now generating around 2,2MW of power, is around -11% less than in 2008.
In order for South Africa to meet its Electricity generation goals and drive meaningful growth in the manufacturing and mining sectors, that hold much potential for both economic expansion and job creation, there will be a requirement to reverse the current downward trend of power generation by multiples.
There can only be serious increases if the government mobilises much more private power generation and reduces regulatory restrictions on volumes allowed to be produced by private companies.
Talks of initiation additional levies on those that have provided their own power generation needs to stop and a clear path forward provided for IPP’s.
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