South Africa’s potential as a market for energy storage could be set to improve following a change in leadership last month.
The appointment of a new president, Cyril Ramaphosa, looks likely to unblock a stalled renewable energy programme and woo back foreign investment scared off by irregularities in the previous administration.
Ramaphosa this week reinstated Nhlanhla Nene, a highly regarded finance minister ousted in 2015 by former head of state Jacob Zuma.
The new leader, who took control of the country after Zuma succumbed to pressure to resign over corruption allegations, named another former finance minister, Pravin Gordhan, to run the Ministry of Public Enterprises.
The Ministry is key to the energy sector because it is in charge of signing off power-purchase agreements between the state electricity company Eskom and plants developed under the nation’s renewables procurement programme.
South Africa’s renewable energy programme
Developers selected under recent rounds of South Africa’s Renewable Energy Independent Power Producers Procurement Program (REIPPPP) had been trapped in a hiatus caused by a scandal involving Zuma and Eskom.
Zuma’s government had dragged its feet over signing the agreements while Zuma handed Eskom coal supply contracts to a family business tied up in the corruption allegations.
When Eskom came clean over faltering finances this year, Gordhan’s predecessor hastily approved outstanding REIPPPP power-purchase agreements in the days before Zuma was forced to resign.
Assuming Eskom can now limp back to financial health, which observers say is only a matter of time, the outlook for renewables in South Africa is once again bright.
One of the consequences of Eskom’s financial ill-health is that it has abandoned plans to build new nuclear plants, leaving renewables as one of the most viable options to increase generation capacity in future.
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