Solar to Become South Africa’s Cheapest Energy Generation

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Written By: Emma Websdale

Increasing South Africa’s energy generation from solar photovoltaic (PV) cells, could potentially lower solar-based electricity cost to half of Eskom’s coal-powered electricity, helping to lower the overall price of electricity beyond 2020, reveals new report.
2548038791According to growth consulting firm, Frost & Sullivan, who compared the cost of solar PV to other energy sources in South Africa, solar could become the cheapest generating technology, reaching R1.69 (rands) a kilowatt-hour (kWh) by 2020.

The report, commissioned by the SA Photovoltaic Industry Association (Sapvia), found that decreasing PV costs by 8% to 10% a year is expected to make renewable energy cost the same, or even lower than coal-derived electricity, for which Eskom (a South African electricity public utility) will be charging an increased 8% on their yearly tariff from 2018.

Currently under the Department of Energy’s renewable energy independent power producers (IPP) procurement program, a total of 1,049 megawatts of PV allocation has already been announced, with the first PV project built and connected to the grid last month in the Northern Cape, three months ahead of schedule. Projects under the IPP programme have also been estimated to create 14, 943 jobs.

Meanwhile, outside the IPP programme, solar PV projects totaling between 15,000 to 20,000MW are under development in South Africa.

According to the Business Report, Eskom is also steering towards progress in its solar projects. Recently securing R1.35 billion from the French institution, Agence Française de Développement, the company will be building a 100MW concentrated solar power (CSP) plant in the Northern Cape, which is expected to produce 525 gigawatt-hours (gWh) a year, powering 200,000 homes.