Page 34 - Energize September 2021 HR

VIEWS AND OPINION

Raising the generation licencing threshold to 100 MW

is necessary but insufficient

Obstructive behaviour and bureaucratic red tape continue to inhibit the uptake of self-generation, embedded
generation, distributed generation, wheeling and trading of electricity in South Africa.

by Chris Yelland, EE Business Intelligence “Outdated thinking and reactionary
rules hold back electricity supply in
here has recently been an South Africa”. These include unnecessary
overwhelmingly positive response limits on the size of LV embedded
Tto successful efforts by a number generation installations; not allowing
of industry, labour and employer LV embedded generation for customers
associations, acting on behalf of electricity with prepayment meters or credit meters
customers, to convince the powers-that-be without time-of-use functionality;
to increase the threshold above which a and irrational and unfair limits on
generation licence is required, from 1 MW compensation to customers when
to 100 MW. supplying electricity back into the grid.
These industry, labour and employer In the meantime, customers in both
associations include the Business Eskom and municipal areas of supply
Unity South Africa (Busa), Congress of continue to experience massive electricity
South African Trade Unions (Cosatu), supply disruptions.
Minerals Council of South Africa (MCSA), Generation capacity shortages
Association for Surface Mining Industries Chris Yelland resulting from Eskom’s high levels of
(ASPASA), Energy Intensive User Group unplanned breakdowns and low availability
(EIUG), National Employers Association of of its generation plant leads to regular load
South Africa (Neasa) and many others. installations which do not have Eskom shedding across South Africa, including by
However, while this reform is certainly authorisation and are therefore not municipal electricity distributors.
necessary and to be welcomed, it is registered with Nersa.
not a sufficient condition to unlock the “The estimation of 27 000 In addition, a far greater number of power
significant potential that self-generation, unauthorised (illegal) connections is outages experienced by customers are
embedded generation, distributed based on Eskom’s market research, caused by problems and issues within
generation, wheeling and trading where the majority is expected to be a both Eskom and municipal electricity
can deliver to domestic, commercial, ‘shared transformer’ scenario. There are distribution networks. These power
industrial, mining and agricultural 27 authorised LV embedded generation failures result from:
customers of electricity, and to the South connections processed at present”, • Ageing and poorly maintained
African economy. says Eskom. “Of these, none are on substations, mini-substations,
To give some idea as to the extent of shared transformer infrastructure due to transformers, lines, cables, switchgear,
the obstructive behaviour and bureaucratic challenges highlighted previously.” and other distribution infrastructure
red tape, it should be remembered that While national figures from municipal • Overloading of distribution equipment
even before the latest amendment of electricity distributors are not readily and circuits due to population growth,
Schedule 2 of the Electricity Regulation available, it is expected that a similar illegal connections and electricity theft
Act (ERA), low-voltage (LV) embedded situation prevails in areas of municipal • Vandalism and theft of electricity
generation installations of less than 1 MW electricity supply. Johannesburg’s City infrastructure such as copper cables,
capacity did not – and still do not – require Power has unofficially indicated that there overhead lines, transformers, steel
generation licences. are an estimated 5000 unauthorised and structures and poles
Yet, despite this, as of 27 July 2021, technically illegal LV embedded generation • “Load reduction” imposed on
Eskom has advised that throughout installations connected to the City Power delinquent municipal electricity
South Africa there are only 27 network alone. distributors, as well as in Eskom
authorised LV embedded generation Further inhibiting and restrictive direct areas of supply, to incentivise
installations connected to the Eskom practices have been detailed in an payment for electricity, and to prevent
grid, and some 27 000 technically illegal earlier article of 23 July 2021, entitled overloading due to electricity theft.

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