The energy industry in South Africa has a bright outlook. It is estimated that about 8.4 GW of power comes from solar photovoltaic. Solar power and wind energy contribute about 1GW and 8. 4GW of power respectively, to the countries energy needs.
Standard Bank finance power head, Alastair Campbell states that despite the rigid terms and regulation, solar power projects that are run by the South African Government as parts of its Renewable Energy Independent Power Producer Programme are able to thrive because of the financial support provided by the local lending market.
He also mentioned that the capability to transfer the debt has been lent to projects chosen within the first two bid windows of the REIPPP. This is what drives local banks to put all their money into this market.
Campbell addressed the gathering at the second yearly Solar South Africa Conference, in Johannesburg. He stressed on the fact that banks should be made the initial source of funding.
The initial procurement of renewable capacity was achieved by the REIPPP as per the Integrated Resource Plan, and the forecast is that 42% of the renewable would include all the power generation achieved by 2030. Estimation is that, about 8.4 GW of power in SA comes from solar photovoltaic. Solar power and wind energy contribute about 1GW and 8. 4GW of power respectively
The local content target for projects has risen from 45% and expectations were that the third round of bidding, which ends in the last week of August, would see a rate of 65%.
Price and economic development were the criteria for the evaluation of compliant bids. As part of social development more emphasis was given to job creation, local content, ownership, management control, preferential procurement, enterprise development and socioeconomic development.
As per Campbell’s expectations and forecasts, wind power would be on par with the State Utility Eskom’s wholesale tariff by the year 2014/15 and solar power might reach this target by 2018/19.
The production and demand for renewable energy would increase if a carbon tax is levied by the National Treasury.