A Model for Africa? South Africa’s Renewable Energy Policy
REIPPPP is an efficient and innovative approach to a country-specific renewables policy; it relies on private sector actors – as opposed to the South African government – to realise renewable energy projects. To this end, the policy uses a very clear and opaque international bidding process known as renewable energy auctions through its Independent Power Producer Program, which has been praised by the International Renewable Energy Agency (IRENA). Furthermore, the policy not only reduces borrowing and funding burdens that would have otherwise fallen on the South African government, but also promotes off-grid and small-scale renewable projects that the public utility company ESKOM has little incentive to pursue. The policy also aims to reduce corruption risks known to be prevalent in such projects.
While boosting renewables is the program’s main goal, it also pays attention to the country’s rampant unemployment and economic inequality. (13% of the South African population does not have access to electricity.) REIPPPP has thus encouraged partial community ownership of the renewable projects, and a share of generated revenue is being diverted towards enterprise development, including hiring locals and transferring skills. In addition, the government has not lost sight of its vision for universal access to electricity, although stats on the improved access to electricity from these renewable projects are not yet available. Moreover, a domestic study has shown that solar and wind projects through the REIPPPP policy program have generated R 8 billion (the equivalent of $651 million) profit for the country.
Though the policy has fostered a dramatic increase in renewable energy and local communities have benefited, IRP still falls short in some respects. It advocates for risky nuclear power, which is currently forecasted to provide 23% of the total generation capacity. Hydropower, in addition, is set to increase from 2.6% to 6% by 2030 in the country’s generation mix. In August 2012 the African Caucus and the Kinshasa II Declaration called for African states to tap more into renewable energy. This and many other such calls have been heeded, at different speeds, in various African countries, which has led to a surge of interest in renewables. However, country-level renewable policies have not necessarily enjoyed success in some countries, including Nigeria and Zambia. At the continental level, initiatives such as the Program for Infrastructure Development in Africa (Pida) continue to promote large, environmentally unsound and socially detrimental dams, blatantly overlooking comparably cheaper, more efficient and environmentally-sound renewable solutions.
South Africa’s Integrated Resource Plan, despite some shortcomings, can and should serve as a renewable energy policy model for the rest of the continent – a model that can be tailored to each country’s needs and opportunities.