Day 2 - 13.30 - Country Spotlight : South Africa

Investment Opportunities within South Africa’s Changing Energy Landscape

Moderator: Dele Kuti, Global Head: Energy and Infrastructure Group, Standard Bank

Ministerial Keynote Presentation: H.E. Honourable Dr. Nobuhle Nkabane, Deputy Minister of Mineral Resources & Energy, Republic of South Africa

Speakers:

• Jacob Mbele, Director General, Department of Mineral Resources & Energy, Republic of South Africa
• Tshifhiwa Bernard Magoro, Head of IPP Office, Republic of South Africa
• Segomoco Scheppers, MD, Transmission, Eskom, Republic of South Africa

 

A highly anticipated Country Spotlight session was held in the afternoon of day two of aef when South Africa took to the stage.

The country has experienced a series of damaging blackouts in recent times, an issue that was addressed by H.E. Honourable Dr. Nobuhle Nkabane, Deputy Minister of Mineral Resources & Energy, in her ministerial speech.

“Access to clean, modern energy in Africa is critical to success of global efforts to tackle poverty,” she said. “While we have achieved success connecting households to power, South Africa has experienced issues with power cuts. To tackle this, we have announced measures to improve the performance of power stations and develop new power stations as quickly as possible.”

Key is procuring a mix of energy capacity, as well as the way this is procured. The role of South Africa’s IPP office is therefore paramount, with Head of the organisation Tshifhiwa Bernard Magoro explaining its remit and successes to date.

He said: “We have made some key achievements and learned lessons from the past. We have procured close to 30 GW, with 12 GW being in the renewable energy space – of this, 6.2GW is already operational and providing power to the grid. Our IPP programme has not only been a catalyst for private sector involvement in South Africa’s energy market, but we’re also seeing some of our IPPs being carried out in the rest of the continent.”

While this progress is promising, all panellists acknowledged that there lies a huge amount of work in front of them to develop the capacity needed to support South Africa’s growing economy and the communities that revolve around it.

“We estimate needing around 28 GW between now and 2030,” said Jacob Mbele, Director General of South Africa’s Department of Mineral Resources & Energy. “At the moment, we have around half of that capacity in procurement programmes… one of the biggest challenges to carrying out these initiatives is that we have two procurement process which rely on the same transmission grid.”

That transmission grid must also be reliable and robust. Commenting on the recent reliability issues, Segomoco Scheppers, Managing Director of Transmission at Eskom, explained that performance was improving and that green shoots were emerging. He also looked ahead to a reorganisation of Eskom into three divisions, including transmission, which will allow for more targeted and sustained investment in the grid.

The session then proceeded into a quickfire audience Q&A, with topics such as the role of regulators and ongoing role of private sector players touched upon.

 

Additional comments: 

Dele Kuti, Global Head: Energy and Infrastructure Group, Standard Bank (session moderator)

“There have been some challenges due to supply constraints and aging infrastructure, but I am convinced that the activity of the last few years is opening up opportunities. There are opportunities for investors to participate in all parts of the industry, from production to transmission and storage.”
 

H.E. Honourable Dr. Nobuhle Nkabane, Deputy Minister of Mineral Resources & Energy, Republic of South Africa

“Coal still dominates the South African energy mix and employs 93,000 people. Our transition must be people centred and take into account all the interests of the country, as well as the particular challenges we are facing. A just transition requires the participation of all stakeholders in South Africa… and must not leave anyone behind.”