Lance Dickerson
In the space of four days South Africans woke up to bad news and good news. First, we learnt that Unit 4 of Medupi suffered a catastrophic explosion, and then four days later we heard that Minerals and Energy Minister Gwede Mantashe finally gazetted the exemptions for embedded power generation up to 100MW.
Medupi’s disaster is very bad news for South Africa. It is no mystery that the energy grid is under immense strain – every one of us has to deal with loadshedding as soon as a unit goes offline, or adverse weather drastically changes consumption patterns. There have been huge cost overruns and delays in bringing Medupi’s units online only for the last one to bow out unceremoniously after almost no time in action.
While the 700MW lost capacity from Medupi wasn’t enough to solve our problems, it did add a bit more of a buffer between business as usual and loadshedding disruptions. That buffer is now gone and coming at a cost of billions of rands and up to two years to repair. The reality is stark: the country has a long, hard road ahead of it to shore up energy supply.
It will come as no surprise to anyone that loadshedding hurts our economy. While it may help Eskom to use the euphemism loadshedding, the protracted, forced power cuts – lest we risk grid failure – come at a huge cost to our economy. Beyond this, even if there were not another day’s loadshedding, and power users continued as they are – minimising their use of electricity – we are still being held back economically.
When compared to a market like the US which uses about 10,000kWh per capita, we have a long way to go to reach our development potential. South Africa currently only uses about 4,500kWh per capita. The squeeze on our energy usage holds back our ability to grow the economy and generate jobs.
This is why Mantashe’s gazetting of the 100MW exemptions is good news. The private sector finally has regulatory leeway to develop independence from the grid at best, and the chance to become less reliant on the grid at worst. While there are government misgivings about a bi-directional network where the private sector would be able to push excess power back into the grid, this future possibility will continue to be touted until such time as the power monopoly can easily produce the amount of power the country needs – and this is not soon.
The drive toward renewable energy generation should be applauded. Besides the obvious benefits for the environment, the cost and time of setting up plants at scale has reduced massively over the years. With Bid Window 5 of the Renewable Energy Independent Power Producers Programme (REIPPPP) opening earlier this year, another potential benefit emerges. If Eskom were able to store excess electricity produced in low-demand periods for reuse in high-demand periods, the grid would be much more stable and have a better chance of providing more capacity when required. Currently, electricity storage is limited mostly to pumped storage.
Where does this leave South African businesses? Companies would do well to try and get themselves into a position where they are not limiting their growth and development because of the country’s unreliable grid. In other words, they need to be free from dependence on the grid.
Revov is uniquely positioned to support businesses in their quest to develop freedom from dependence on the grid because of the high and continually growing availability of our market-leading 2nd LiFe batteries. The future of energy generation is renewable, and the future of storage is lithium, especially 2nd LiFe batteries, which are built from automotive grade lithium iron phosphate cells. Besides the cost savings when compared to 1st LiFe batteries, the guarantee we assign to the batteries, as well as their sterling performance, makes them the leading energy storage solution for our country.
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