IRP: Government urges private producer interventions for an energy mix
Eskom is expected to integrate with renewable energy.
On Friday, Gwede Mantashe, the Energy and Minerals Minister, introduced the Integrated Resources Plan (IRP) as South Africa’s mid-term solution to electricity issues.
Government calls for better energy prices from private energy producers
The government has cried out to private energy producers to offer better prices and promises to issue an urgent call for energy solutions to mitigate Eskom’s energy supply catastrophe.
The IRP is a national electricity plan, a subdivision of the Integrated Energy Plan, meaning it isn’t a long term solution, as the government states it is a plan that directs the expansion of electricity supply over a particular time-frame. The need for private energy interventions is desperately needed to fix the current energy crisis.
Mantashe noted that the Cabinet’s approval of the IRP has brought “security” to the economy and it will shed some light on the country’s future following the energy mix.
“As a department, we have been categorically clear from the outset that our task is not to be a lobby group for a particular energy technology, but rather, to execute our mandate of ensuring the security of energy supply using all available resources. Now that the energy mix has been outlined, we must work with the necessary speed and resolve to ensure its implementation.”
Energy and Minerals Minister, Gwede Mantashe
Eskom has been tasked to include renewable energy
Eskom has been approved to incorporate renewable energy, and nothing should be “standing in the way” from competing and gaining generation assets in the sector, as Eskom needs to have the “freedom to expand its interests to renewable energy.”
Mantashe stated that the country was not planning to install large nuclear units, instead it will install modular nuclear plants; however, the IRP indicates that energy mix will continue to be reliant on coal because it is the resource that the country has richly.
Coal producers are requested to lower their prices
The Department of Energy and Mineral Resources states that coal producers need to lower their prices while the country is still dependent on coal.
“Coal producers must decrease their prices for coal. The intention is not to kill coal producers, but to ensure that although they must make their money, they must not make obscene profits because of the pressure. So, we are talking to both the producers of renewables and of coal.”
Energy and Minerals Minister, Gwede Mantashe
The Department emphasised that the current price charged by independent power producers (IPPs) was unsustainable, and “energy-intensive sectors are battling”.
“The price of electricity is expensive. We are told that IPPs charge about R2.40 a unit, but the reality is that for window one photovoltaic [which is solar power], we are paying R4.25 a unit – because it was sold at R2.20 but was guaranteed an increase at CPI, and this has moved it to R4.25 a unit.”
Energy and Minerals Minister, Gwede Mantashe