South Africa and the Rise of Renewable Energy on the Continent

Posted on | november 11, 2011 | No Comments

Two of the largest renewable energy projects ever attempted are being built on the African continent. The World Bank’s Board of Executive Directors have approved $250 million in funding for the Eskom Renewables Energy Support Project (ERSP) to help implement major solar and wind power projects in South Africa. The new financing complements the US$260 million provided to Eskom to implement the Upington and Sere renewable energy projects included in the $3.75 billion Eskom Investment Support Project approved in April 2010.

South Africa’s Power Sector Integrated Resource Plan began in 2010 and by 2030 the country aims to meet 42% of its national demand for power using renewable energy sources.

The Upington Project will be a one hundred megawatt, utility-scale, concentrating solar power plant to be located in Northern Cape province. Emission savings are estimated at about 9-million tons of CO2 equivalent over a 20-year life span.

The construction of the Upington project will create a significant number of jobs. As a whole the solar market has the potential to be a major employer in South Africa. The Spanish PV market created 28,000 jobs between 2001 and 2010 to account for slightly more than 3,000MW of PV. South Africa is planning to build 8,400MW of PV, with another 1,000MW of concentrated solar power (CSP) technology. Extrapolating from these numbers the whole solar energy industry in South Africa could provide in excess of 60,000 jobs. The infrastructure required for massive solar parks in the Northern Cape will require infrastructure that could create up to 100,000 jobs.

The Upington project is estimated to cost a total of R150 billion (US21.3 billion) and it is expected to start operating in 2012.

The Sere Project will be a one hundred megawatt wind power project located 300 kilometers (190 mi) north of Cape Town. The project will create at least 140 direct jobs during the construction phase and 10 permanent jobs once the plant is operational. It is targeted to reduce South Africa’s CO2 emissions by 5 million tons during its first 20 years. Evaluating and reassessing existing studies in 2003, a South African renewable energy strategy formulation team from the Department of Minerals and Energy estimated the total wind generation potential for the entire nation to be 60 TWh per annum.

The Sere project is estimated to cost R2.689 billion ($375 million)and Eskom has stated that the plant will be commissioned by 2012 and expects the plant to be fully operational by summer 2013.

The Clean Technology Fund is providing the loan for these pioneering and innovative projects which will go to South Africa’s power utility, Eskom. The Clean Technology Fund promotes scaled-up financing for demonstration, deployment and transfer of low-carbon technologies with significant potential for long-term greenhouse gas emissions savings.

These two projects are important not only for South Africa but for the entire continent. They make an important point about the viability of renewable energy in the developing world.

“Africa is rich in sources of renewable energy, and broadening the existing mix to include renewables is essential for sustainable development of the energy sector,” said Jamal Saghir, World Bank Director for Sustainable Development for the Africa Region. “Once implemented, these pioneering energy projects will provide powerful demonstrator effects for the benefit of Africa’s largest economy and beyond.”

The fact that only 31 percent of Africa’s population has access to energy, is both a challenge and an opportunity. The challenge comes from meeting the continent’s energy needs. The opportunity comes from renewable energy development that skips the industrial world’s large scale reliance on energy derived from fossil fuels.

These projects underscore the World Bank’s development strategy for Africa which emphasizes competitiveness and employment by harnessing technology and innovation from the private sector.

“We are very pleased to assist South Africa launch these ambitious flagship renewable energy projects,” said Ruth Kagia, World Bank Country Director for South Africa. “They will help South Africa to fulfill its commitments on lowering emissions while demonstrating the viability of large-scale renewable energy projects undertaken in Africa.”

The South African economy is one of the most carbon-intensive in the world, however, investment in large scale renewable energy projects are helping to position the country as a leader in clean energy.

Renewable energy is not only benefiting South Africa, the development of renewable sources of energy has the potential to transform a continent burdened by poverty.

AUTHOR: Richard Matthews
E-MAIL: smallbusinessconsultants [at]


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