The Department of Mineral Resources and Energy (DMRE) has published the gazette on the lifting of the self-generation threshold to 100MW, without licencing, giving a sure indication that the government is serious around driving investment in the energy generation sector, in order to support economic growth and diversify the generation sources away from just a single risk entity.
This is the view of the South African Wind Energy Association (SAWEA), in response to the published amendments to Schedule 2 of the Electricity Regulation Act, on Thursday 12 August 2021.
“This announcement means that the industry can now easily enter into Power Purchase Agreements with private entities, especially intensive energy users (IEUs) and deliver projects quickly, which will stimulate economic recovery,” explained Ntombifuthi Ntuli, CEO of SAWEA.
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She added, “However, as with any legislation, there are elements left open for interpretation and will require clarity, hence, we will continue to engage the DMRE.”
It has been reported that large companies, mines and farms are believed to have 5,000MW in pent-up projects, which could be released if licensing requirements were lifted.
Independent Power Producers earlier reported that several mining houses and other IEUs have reached out to the industry enquiring about projects that are ready for procurement. The Association sees this as a clear intention to procure clean energy from the wind sector.
By lifting the threshold, it will allow IEUs, which make up a significant portion of the South African GDP, to establish new generation capacity that will in turn stimulate the economy as well as free up the Electricity Availability Factor (EAF).
The Department of Mineral Resources and Energy (DMRE) was established in June 2019 by the merger of the Department of Energy and the Department of Mineral Resources.
