gcu364 honors paper

Renewable Energy Development in

South Africa

Vanessa Ferrero

Martin Pasqualetti

GCU364

May 6, 2016

Renewable Energy Development: South Africa Ferrero

1

Introduction: Why Developing Nations Matter

Less than twenty percent of the world’s population inhabits industrialized nations, so a

sizeable amount of people still live in what are considered developing countries (Gorman). When

considering the issue of climate change and its anthropogenic causes, it is impossible to ignore

that as nations industrialize their greenhouse gas emissions increase. This is because an increased

quality of life is generally related to greater energy accessibility and therefore energy

consumption. As a nation industrializes, its citizens have more access to energy resources which

allow them to develop further as countries and compete within the global market.

With so many nations still considered “developing,” it becomes clear why they are the

focus of many talks on climate change. In short, the way in which these countries decide to

develop (and more importantly, how they choose to meet their growing energy needs) will have a

large impact on our ability to tackle the problem of climate change as a species. Currently,

industrial nations must make efforts to introduce renewable and alternative energies into their

energy systems in order to reduce their fossil fuel use. Developed nations had the luxury of

developing during a time when the consequences of fossil fuels were unknown, and now the

world is paying the price for the freedom these countries were able to have. However, now that

we know that there is a link between fossil fuel consumption and climate change (through energy

production and greenhouse gas emissions) it would be irresponsible for current developing

nations to industrialize following the examples of their predecessors. While this can be addressed

as an issue of environmental justice and inequalities, the fact is that our planet can’t afford to

have everyone on earth contributing to climate change with the same emission levels that

countries such as the United States have.


2

The solution for developing nations, then, is to start tackling their energy infrastructures

early on. By using renewable energy sources for a majority of their energy needs and planning a

grid system that is able to handle these sources with greater ease than more “traditional” grids,

these countries would be able to industrialize with reduced environmental effects. Rather than go

through a period of relying on coal or oil for electricity, for example, a developing nation can

focus on its geothermal, hydroelectric, solar, and wind power potential and incorporate these into

their electricity generation from the very onset of their industrialization. The idea behind this

leap, where countries would skip from virtually no electrification to mostly renewable

electrification is often likened to these countries’ leap from “no phones” to “cellphones.” Just as

many developing nations skipped landline use and the development of that infrastructure, the

worldwide community is urging them to skip fossil fuel use and opt for renewables instead.

While these actions by developing nations will reduce their environmental impact once

they are industrialized, this doesn’t mean that the burden of addressing climate change falls

solely on developing nations. These countries are only a piece of the puzzle, and they fit into

global talks and agreements by working to reduce any future emissions they may put out by

planning their energy systems carefully and implementing favorable policies early on. However,

industrialized nations are responsible for the majority of the greenhouse gas emissions to date,

and as such they would not be “off the hook” simply because developing nations avoid

emissions. Industrialized countries must also do their part to address the issue of climate change,

but it is important to note that the prevention of future emissions (by developing nations) is a

necessity to try to mitigate the anthropogenic causes of this environmental threat.


3

The Case of South Africa

Although it is considered a newly industrialized country, South Africa has a pretty

impressive ranking as the world’s eleventh largest greenhouse gas emitter (Barbee). It is often

grouped with Brazil, Russia, India, and China as part of the BRICS countries, considered by

economists and political scientists to be areas of fast economic growth and strong political

influence. Home to 53.5 million people, South Africa may not be a large nation like India or

China, but the way in which it chooses to develop its renewable energy could set an example for

the rest of Africa, with around 1.2 billion people living on the continent (Africa Population).

In the past, South Africa produced most of its energy from coal and oil, leading to high

emissions from these fossil fuels. With the world’s ninth-largest recoverable coal reserves and

95% of Africa’s total coal reserves, the country has embraced coal not only for its own energy

needs but also for export (South Africa, EIA). More than a quarter of South Africa’s coal

production is exported, with most of it going to Asia (and particularly, India) (South Africa,

EIA). Today, coal continues to account for 93% of South Africa’s electricity generation, and the

country’s monopoly electrical utility, Eskom, still has plans for developing more coal plants in

the future (Winkler 27). In 2008, South Africa experienced a “severe shortfall in its electric

power generation capacity, estimated at just over 10%,” which pushed the government to look

into diversifying its energy mix (Sebitosi, Renewable Energy 3313). Figure 1 on the following

page shows South Africa’s grid system, showing an increasing in hydroelectric, renewables, and

nuclear compared to past electricity generation.


4

Figure 1: South Africa’s Grid System, from Eskom.

Renewable energy is now something South Africa is pursuing more actively than before,

and its strong potential for wind and solar power is very promising for the country. If South

Africa is able to truly push for renewables and achieve a reduction in the electricity it is deriving

from fossil fuels, the country could make big changes in its carbon emissions. This paper looks

into the potentials for renewable energy development in the country, and what steps are being

taken to achieve these changes.

Renewable Energy Developments

In 2003 the South African government put out a white paper on renewable energy

development, where it demonstrated that it understands all of the details necessary to work

towards a renewable energy industry. The paper states that “a Strategy on Renewable Energy

will be developed, which will translate the goals, objectives and deliverables set out herein into a

practical implementation plan” (Sebitosi, Renewable Energy 3313). These would include the


5

financing and economics, the technological development, the education and awareness, as well

as the actual building of greater capacity and governance of the industry. However, when the

country experienced rolling blackouts from 2005 to early 2008 due to electricity shortages, the

government had yet to implement any type of renewable energy strategy (Sebitosi, Grappling

2514). In the years since, Eskom has “spent $180 million upgrading its network of transmission

stations and strung hundreds of miles of high-voltage power lines to more than 40 private wind

and solar plants” (McGroarty). Although the country is still heavily dependent on fossil fuels,

South Africa has been “quietly creating one of the world’s most progressive alternative energy

plans” (Barbee).

Solar Power in South Africa

South Africa has a very large potential for solar power (see Figure 2, below) and the

country has set goals for forty-two percent of newly-installed energy capacity to come from

renewables by 2030 (Jacobs). In 2013, South Africa was named the “most attractive emerging

country for solar energy” by the IHS’s Emerging Markets Attractiveness Index (Jacobs).

Figure 2: Solar Potential in South Africa, from GeoModel Solar.


6

South Africa’s solar photovoltaic (PV) capacity is expected to reach 8.4 GW by 2030

(Jacobs). Furthermore, the International Renewable Energy Agency released a report in 2015

projecting renewable energy to more than quadruple from 5% of electricity generation to 22% by

2030 as well (Gilpin). Some of the major PV initiatives that were completed in 2014 include

Herbert 1—a 22 MW plant using 90,000 locally-manufactured panels—and De Aaar, a 50 MW

facility (Jacobs). The Herbert 1 facility is in the Northern Cape, located 500 miles from

Johannesburg, the country’s top energy consumer. Getting the solar energy from this desert to

South African cities has proven to be one of the biggest challenges that Eskom faces

(McGroarty).

Aside from solar PV, the South African government has also been encouraging

households and companies to invest in solar heating systems and solar panels by offering

government subsidies. These subsidies are meant to cover around forty percent of the costs of

solar systems, comparable to the tactics that countries like Germany have used to increase their

renewable energy presence (Jacobs). While the use of these small-scale renewable energy

systems won’t make a major difference in the overall energy mix of the country, they do provide

social and economic benefits (Gilpin). The tech scene in countries like Kenya, Nigeria, and

South Africa has been growing quickly and the growth of the renewable sector is only adding to

the momentum in these countries to encourage the innovation of their citizens in the tech

industry (Gilpin). The growth of the renewable sector opens up opportunities for more

specialized jobs and community involvement in energy production, all while helping to stabilize

the energy grid and increase South Africa’s energy mix.

Another technology being encouraged by the South African government is the

development of concentrating solar power (CSP) facilities. By opening its previous electricity


7

monopoly to independent power producers (IPPs), South Africa has been able to accept bids by

various international companies to develop the renewable energy in the country (Burger).

Spain’s Abengoa, for example, is currently working on two CSP projects in the Northern Cape.

The KaXu Solar One project uses parabolic trough reflectors to generate 100 MW of power with

a storage capacity (using molten salts) of two and a half hours (Chadha). The project is owned

jointly by Abengoa, the Industrial Development Corporation (IDC), and the KaXu Community

Trust, and was funded by several international banks (Chadha). Abengoa’s other CSP project is

Xina Solar, adjacent to the KaXu power plant and expected to be commissioned by 2017. The

Xina Solar facility also uses parabolic troughs and is expected to produce 100 MW of power that

can be stored for up to five hours (Chadha). These projects were secured by Abengoa through

auctions that South Africa held under the Renewable Energy Independent Power Producers

Programme (REIPPP).

The REIPPP has allocated sixty projects to date for production in South Africa. A

majority of these projects are for solar PV with a cumulative generation capacity of 1,540 MW

(Chadha). Five solar thermal power plants totaling 400 MW have also been allocated and four

CSP projects are also underway (Chadha). The country’s willingness to partner with IPPs has

been hailed as a model for other African governments to follow in order to increase their

renewable energy production (McGroarty).

Wind Power in South Africa

While the Northern Cape offers high solar potential, South Africa also has a large

potential for wind power—particularly in the Western Cape and coastal regions (see Figure 3,

following page). Eskom has begun developing many wind projects in the country, with the


8

energy from these now costing five US cents per kWh, or roughly half of what the energy costs

are when produced by coal (Barbee).

Figure 3: Wind Power Potential in South Africa, from Global Energy Network Institute.

One of the largest developments in wind power for South Africa is the Sere wind farm

project, completed in January of 2015. This wind farm has 46 wind turbines to produce 100 MW

at full capacity, and the project also required the construction of a new substation and a 43-

kilometer transmission line (Renewable Energy). Eskom’s Acting Chief Executive, Dan

Marokane, stated that the “Sere wind farm is Eskom’s first large-scale renewable energy project,

and forms part of our commitment to renewable energy and reducing our carbon footprint. We’re

building a world-class, utility scale wind farm” (Renewable Energy). With the power that Sere

will generate, South Africa expects to save nearly six million tons of carbon emissions over the

next twenty years, and the facility will provide much-needed power to the grid to continue to

work to reduce blackouts (Renewable Energy). Marokane explains that even though the project

has a relatively small capacity, it shows Eskom’s commitment to growing the renewable power

sector (Renewable Energy).


9

Energy Efficiency in South Africa

Another aspect of renewable energy development is working on the country’s energy

efficiency in order to reduce the overall energy demand. In South Africa, the availability of

comparatively cheap energy has led to its inefficient use (Winkler 26). Because South Africa has

a relatively high energy intensity, making more efficient use of energy becomes even more

important and policy initiatives are already under way with respect to energy efficiency

(Wrinkler 26). “Many interventions have been proposed and studied in detail and these suggest

that it makes economic sense to promote end-use energy efficiency and demand-side

management,” and an overall strategy to reduce final energy demand by twelve percent can be

implemented in the industrial sector (Wrinkler 27, 31). Though these programs have not been

pushed as heavily as the renewable energy projects in the country, energy efficiency will clearly

play an important role as South Africa continues to grow as an industrialized nation.

Conclusions and Future Prospects

Though South Africa is still largely dependent on coal for its energy production, the

country is beginning to incorporate more renewable energy sources into its electricity generation

in order to reduce the electricity shortages and blackouts that it has been experiencing during the

past decade. South Africa only accounts for around one percent of global emissions, yet its per

capita emission rate (9 tonnes CO2 equivalent per person) almost equaled the average emissions

in the European Union (10.7 tonnes CO2 equivalent per person) (Pegels 4946). Due to its

dependence on coal, South Africa averages 850 g CO2 per kWh of energy—nearly twice as high

as the average for industrialized countries (Pegels 4946). By diversifying its energy mix and

branching out to produce more electricity from renewables, South Africa can work on lowering


10

this ratio and reducing its emissions while developing a more consistent grid to meet its energy

demands.

South Africa is fortunate that it has the potential to harness a lot of its energy from solar

and wind power, unlike other countries with less favorable geographic locations. Eskom, the

national utility, has agreed to work with independent power producers, and the Renewable

Energy Independent Power Producers Programme has established an auction system by which

various companies can work to develop the renewable energy of the country. Currently, sixty

projects have been granted through this auction system, and the IPPs work with the government,

local communities, and international banks in order to fund and commission the projects.

Two notable concentrated solar projects, each with 100 MW capacity, are under the

authority of Abengoa, and many other PV and solar-thermal projects have also been approved.

Eskom itself has made efforts to increase its renewable presence, building the first large-scale

wind farm in South Africa, Sere. While these projects demonstrate the commitment of both

Eskom and the South African government to renewables, the country still has a long way to go to

slowly wean itself off of coal. With so many coal reserves and an established coal dependence,

Eskom has yet to stall the construction of new coal-fired power plants. Hopefully in the future

Eskom abandons its coal efforts and focuses solely on renewable energy development as the

country continues to industrialize. The importance of energy efficiency was briefly touched on,

as it will play an important role in the development of South Africa’s energy system, but the

government has yet to implement any major policies regarding energy efficiency.

South Africa is a promising nation for renewable energy development and its successes

can be used as a model for other developing nations (particularly, other African nations). South


11

Africa’s main struggles relate to its current dependence on coal, highlighting the importance of

developing renewables from the beginning before a country is reliant on fossil fuels.


12

References

"Africa Population 2016." WPR. World Population Review, 13 Sept. 2015. Web.

<http://worldpopulationreview.com/continents/africa-population/>.

Barbee, Jeff. "How Renewable Energy in South Africa Is Quietly Stealing a March on

Coal." The Guardian. Guardian News and Media, 01 June 2015. Web.

Burger, Andrew. "South Africa Fights Blackouts with Concentrating Solar Power." Triple

Pundit. Triple Pundit, 19 Dec. 2014. Web.

Chadha, Mridul. "Abengoa Commissions South Africa’s First Concentrated Solar Power

Plant." CleanTechnica. CleanTechnica, 06 Mar. 2015. Web.

Gilpin, Lindsey. "Renewable Energy Is About To Boom In Africa, And We Need To Pay

Attention To It." Forbes. Forbes Magazine, 19 Oct. 2015. Web.

Global Horizontal Irradiation- South Africa. Digital image. Solar GIS. GeoModel Solar, n.d.

Web. <http://solargis.info/doc/_pics/freemaps/1000px/ghi/SolarGIS-Solar-map-South-

Africa-en.png>.

Gorman, Tom. "The Global Market and Developing Nations." Infoplease. Infoplease, n.d. Web.

<http://www.infoplease.com/cig/economics/world-economies.html>.

Jacobs, Sherelle. "South Africa Is Primed for Major Solar Development."Renewable Energy

World. Renewable Energy World, 20 May 2014. Web.

McGroarty, Patrick. "South Africa Pushes to Expand Renewable Energy."The Wall Street

Journal. The Wall Street Journal, 13 Sept. 2015. Web.

Pegels, Anna. "Renewable Energy in South Africa: Potentials, Barriers and Options for

Support." Energy Policy 38.9 (2010): 4945-954. Web.

"Renewable Energy - Sere Wind Farm Project." Eskom. Eskom, 30 Jan. 2015. Web.

<http://www.eskom.co.za/Whatweredoing/NewBuild/Pages/Renewable_Energy.aspx>.

Sebitosi, A.b., and P. Pillay. "Grappling with a Half-hearted Policy: The Case of Renewable

Energy and the Environment in South Africa." Energy Policy 36.7 (2008): 2513-516.

Web.

Sebitosi, A.b., and P. Pillay. "Renewable Energy and the Environment in South Africa: A Way

Forward." Energy Policy 36.9 (2008): 3312-316. Web.

"South Africa." EIA Beta. U.S. Energy Information Administration - EIA - Independent Statistics

and Analysis, 29 Apr. 2015. Web.

<http://www.eia.gov/beta/international/country.cfm?iso=ZAF>.


13

South African Grid Map. Digital image. Eskom. Eskom, n.d. Web.

<http://www.eskom.co.za/OurCompany/CompanyInformation/PublishingImages/map_sa

.jpg>.

Wind- South Africa. Digital image. Geni. Global Energy Network Institute, n.d. Web.

<http://www.geni.org/globalenergy/library/renewable-energy-

resources/africa/Wind/wind-south-africa.png>.

Winkler, Harald. "Energy Policies for Sustainable Development in South Africa." Energy for

Sustainable Development 11.1 (2007): 26-34. Web.

gcu364 honors paper

Documents