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REPORTS that MPs are to visit Medupi due to further delays and cost overruns of a conservative estimate of R14bn are worrying.
We wonder whether the newly appointed Minister of Energy, Ben Martins, will push Eskom to put sustainability first and move away from the fixation on centralised coal and nuclear generation to a new era of renewable energy.
The Medupi cost overrun is a considerable sum of money. Keep in mind that the now projected cost of R105bn is without interest during construction or IDC, which will add at least another whopping R30bn to the bill.
This money could go a long way towards providing clean water and waterborne sanitation and creating real, constructive (not construction) jobs as well as multiple opportunities for decentralised renewable energy, including providing a “smart grid”.
Eskom, however, seems determined to persist with its centralised large-scale generation, which it says will give us a shortfall of 700 megawatts next year.
The IDC for solar or wind generators is always much lower in relation, since the construction usually does not take longer than a year. With coal or nuclear plants the money only starts to flow back 10 or more years after construction, and you have to pay the interests on the money spent to date.
Nuclear is not cheap either. The proposed 3 200 MW UK nuclear power plant at Hinkley Point in England, for example, is proposed to cost £14bn (R210bn - without IDC) - that's R65m per MW. (Another factor that must be considered is that decommissioning UK's nuclear legacy has skyrocketed from an estimated £49bn in 2010 to more than £80bn today.)
In 2011 Italy installed 9 000 MW of rooftop photovoltaics, financed by private enterprise. Is this not the time for the department of energy to “scrap the cap”, provide a feed-in tariff and allow civil society unlimited opportunity to develop renewable energy in South Africa?
We have some of the best solar resources in the world.
Research indicates that a 1 MW rooftop solar PV installed and grid connected would cost R18m (without batteries). If the department would lift its bureaucratic controls we could have solar energy feeding into the grid in a matter of months.
In 2008 the Southern African Faith Communities’ Environment Institute (SAFCEI) anaul general meeting asked Valli Moosa, then chairperson of Eskom, for a meeting with his board. Steve Lennon was sent to meet us.
He was in charge of renewable energy and responsible for the non-functioning, poorly sited Klipheuvel wind farm. He did his best to convince us that renewable energy was not a solution for South Africa.
In 2010 a coalition of 65 South African civil society organisations petitioned the World Bank against its loan for Medupi. Our finance minister wrote to Washington saying the loan was essential.
One benefit was the World Bank’s insistence that a wind farm and a 100 MW concentrated solar power plant should be developed – this is finally happening three years later.
In 2013 the Electricity Governance Initiative of South Africa (EGI-SA), a coalition of national civil society organisations, produced its Smart Electricity Plan.
The well-researched “Smart” plan clearly shows that with energy efficiency and renewable energy we will not only do away with the need for new nuclear and coal power plants, but will reduce costs and increase employment.
We know that turning to renewable energy will require a “smart grid”. Well, that cost overrun of R14bn would go a long way to providing this grid.
We know too that decentralised renewable energy is the only way we can bring electricity to the 2 million rural homesteads scattered across our country. Most importantly, we know that an overriding priority is to reduce carbon emissions and create jobs.
The smart electricity plan shows how we can have a far healthier system for generating our electricity as well as providing for more jobs.
Most important of all, we all have to recognise that we have an overriding urgency to reduce carbon emissions and to put the well-being of the planet and its people as our priority.
- Fin24
*Bishop Geoff Davies is the founder and executive director of the Southern African Faith Communities Environment Institute, a multi-faith environment NGO.
We wonder whether the newly appointed Minister of Energy, Ben Martins, will push Eskom to put sustainability first and move away from the fixation on centralised coal and nuclear generation to a new era of renewable energy.
The Medupi cost overrun is a considerable sum of money. Keep in mind that the now projected cost of R105bn is without interest during construction or IDC, which will add at least another whopping R30bn to the bill.
This money could go a long way towards providing clean water and waterborne sanitation and creating real, constructive (not construction) jobs as well as multiple opportunities for decentralised renewable energy, including providing a “smart grid”.
Eskom, however, seems determined to persist with its centralised large-scale generation, which it says will give us a shortfall of 700 megawatts next year.
The IDC for solar or wind generators is always much lower in relation, since the construction usually does not take longer than a year. With coal or nuclear plants the money only starts to flow back 10 or more years after construction, and you have to pay the interests on the money spent to date.
Nuclear is not cheap either. The proposed 3 200 MW UK nuclear power plant at Hinkley Point in England, for example, is proposed to cost £14bn (R210bn - without IDC) - that's R65m per MW. (Another factor that must be considered is that decommissioning UK's nuclear legacy has skyrocketed from an estimated £49bn in 2010 to more than £80bn today.)
In 2011 Italy installed 9 000 MW of rooftop photovoltaics, financed by private enterprise. Is this not the time for the department of energy to “scrap the cap”, provide a feed-in tariff and allow civil society unlimited opportunity to develop renewable energy in South Africa?
We have some of the best solar resources in the world.
Research indicates that a 1 MW rooftop solar PV installed and grid connected would cost R18m (without batteries). If the department would lift its bureaucratic controls we could have solar energy feeding into the grid in a matter of months.
In 2008 the Southern African Faith Communities’ Environment Institute (SAFCEI) anaul general meeting asked Valli Moosa, then chairperson of Eskom, for a meeting with his board. Steve Lennon was sent to meet us.
He was in charge of renewable energy and responsible for the non-functioning, poorly sited Klipheuvel wind farm. He did his best to convince us that renewable energy was not a solution for South Africa.
In 2010 a coalition of 65 South African civil society organisations petitioned the World Bank against its loan for Medupi. Our finance minister wrote to Washington saying the loan was essential.
One benefit was the World Bank’s insistence that a wind farm and a 100 MW concentrated solar power plant should be developed – this is finally happening three years later.
In 2013 the Electricity Governance Initiative of South Africa (EGI-SA), a coalition of national civil society organisations, produced its Smart Electricity Plan.
The well-researched “Smart” plan clearly shows that with energy efficiency and renewable energy we will not only do away with the need for new nuclear and coal power plants, but will reduce costs and increase employment.
We know that turning to renewable energy will require a “smart grid”. Well, that cost overrun of R14bn would go a long way to providing this grid.
We know too that decentralised renewable energy is the only way we can bring electricity to the 2 million rural homesteads scattered across our country. Most importantly, we know that an overriding priority is to reduce carbon emissions and create jobs.
The smart electricity plan shows how we can have a far healthier system for generating our electricity as well as providing for more jobs.
Most important of all, we all have to recognise that we have an overriding urgency to reduce carbon emissions and to put the well-being of the planet and its people as our priority.
- Fin24
*Bishop Geoff Davies is the founder and executive director of the Southern African Faith Communities Environment Institute, a multi-faith environment NGO.
