The Challenges for Renewable Energy Businesses in SA Glynn Morris AGAMA Energy

1
The Challenges for Renewable Energy Businesses in
SAGlynn Morris - AGAMA Energy

• Status of RE sector in SA
• Nature of RE in SA
• The players
• The blockers
• Other examples of growing RE sectors
• EU Synergy Programme Recommendations for Action
• The solutions

2
The Status of the Renewable Energy Sector in SA

• The RE sector in SA is a CINDERELLA industry
• It is a REAL business sector in the SA economy -
  but very small at present, say approx. R100
  million per annum
• It is probably stagnant or shrinking in real
  terms (no reliable stats - hard to tell)
• The potential for excellent economic growth is
  twofold
• sectoral growth of the industry itself
• added value to other sectors
• Environmental considerations - mostly very
  positive

3
The nature of the RE sector

• Research and development
• Manufacture
• Installation contracting
• Maintenance contracting
• Consulting
• Education and training
• Service provision

4
The players

• Government
• National - DME DEAT DTI Finance
• Provincial
• Local
• Eskom - Eskom Eskom Enterprises Shell/Eskom JV
• Multinational divisions/agents - Siemens, Shell
  Renewables, EDF, etc.
• Small SA firms - approx. 50 in total
• NGOs - SESSA, SAWEA, Earthlife Africa, WWF-SA,
  etc.
• Financiers - local and international

5
The blockers

• No public support to the White Paper commitments
  to RE
• Insufficient long-term planning and programme
  commitments
• Ongoing hidden subsidies to existing players
  e.g. Eskom liquid fuel sector nuclear sector
  local authorities
• Insufficient turnover and margins in RE sector
  for sustained growth
• Poor sectoral co-ordination and development

6
Other examples of growing RE sectors

• Developed countries
• Europe
• USA
• Japan
• Developing countries - Southern Africa
• Namibia
• Botswana

7
EU Synergy Programme Recommendations for Action -
ECN, CSIR, RISO, RMA

• Bulk Renewable Energy
• Develop a 200MW per annum set-aside programme
• Develop and implement power purchase regulation
• Implement capacity building
• Off-grid Renewable Energy
• Send out a consistent message from Government
• Raise awareness of rural energy options and
  realities
• Make electrification planning more transparent
• Implement energy planning within Integrated
  Development Planning Process
• Provide capacity building

8
EU Synergy Programme Recommendations for Action -
contd

• Demonstration and Commercial Projects
• provide financial support
• Provide capacity building
• Provide technology

9
The Solutions?

• A government commitment to procure RE services
  over next decade
• Opening up of the energy markets based on
  criteria of sustainability and transparency
• Implementation of specific programmes
• RE IPP set-aside programme
• SWH programme
• thermal efficiency in housing - energy footprint
  for buildings
• Government commitment to long-term public
  awareness programme - like Bonesa energy
  efficiency programme
• Capacity building in all aspects of RE