Gordhan: Eskom should be allowed to compete in the renewable space

Amid massive changes in the fields of electricity and technology, Eskom is repositioning itself as a business - and should get the chance to be a contender in the renewable energy space, Public Enterprise Minister Pravin Gordhan has said. 

Gordhan was speaking at a meeting with the joint portfolio committee on energy and public enterprises on Tuesday. The committees were briefed by Eskom on its governance challenges and coal supply shortages.

Gordhan had attended the meeting as an observer, but was asked by chair of the energy portfolio Fikile Majola to share a few words about the entity.

The minister noted that the Integrated Resources Plan (IRP) was, in its own right, a game changer for energy. The IRP was gazetted by Energy Minister Jeff Radebe on Monday for public comment.

The plan outlines how government intends to manage electricity supply up until 2030. It favours a least-cost plan which supports PV, wind and gas. 

"There’s no reason, if the coal side of the business begins to decline slowly for climate change and other reasons, that Eskom shouldn’t be a supplier of renewable energy as well," he said.

This would add to Eskom’s competitiveness in the market, which also has nuclear, coal and diesel in its energy portfolio, he explained.

Eskom chair Jabu Mabuza, who also responded to the question about general views on the IRP - posed by DA MP Gavin Davis - said the plan was still being studied, and that more time was required before Eskom could make a formal comment on it.

"We just had a cursory look at it… We are still going to study it."

Mabuza added that Eskom had made its own submissions to inform the new IRP. 

Following the release of the IRP, the DA issued a statement, noting the shift away from building new nuclear plants. At the media briefing on Monday, Radebe confirmed that there would be no increase in the use of nuclear energy up until 2030.

Dr Dom Wills, CEO of solar PV company SOLA Future Energy, said in a written reply to Fin24's question that the shift towards renewable energy, away from coal-fired power stations which are being decommissioned, was a "modern approach".

Less reliance on nuclear and coal shows an understanding that base load can be achieved with a mix of renewable energy technologies, combined with gas, he explained. 

Wills also said that workers in the coal industry could be absorbed in the renewable space, as construction of the plants would be required and employment could be created through the operation of plants. 

For the next 20 years, as coal-fired power stations are decommissioned, SA will rely on a combination of renewables and gas and battery storage technologies to keep up with demand, Wills explained.

"We have more than enough land and concentration of renewables, and the balancing of the grid is a complex but solvable problem.

"We also have 30 years (up until 2050) to manage this transition properly. It’s not an overnight phenomenon," he said.

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