ENERGY UPDATE

ACTION PLAN
SIX MONTH UPDATE: JANUARY 2023

REPUBLIC OF SOUTH AFRICA

INTRODUCTION KEY ACHIEVEMENTS TO DATE

Schedule 2 of the Electricity Regulation Act has been amended to

In his address to the nation on 25 July 2022, President Cyril
Ramaphosa announced a bold set of actions to address
load shedding and achieve energy security.
The National Energy Crisis Committee (NECOM) has since
been established to oversee the implementation of five key
interventions:
1. Fix Eskom and improve the availability of
existing supply
2. Enable and accelerate private investment in
generation capacity
3. Accelerate procurement of new capacity
from renewables, gas and battery storage
4. Unleash businesses and households to
invest in rooftop solar
5. Fundamentally transform the electricity
sector to achieve long-term energy security
remove the licensing requirement for generation projects of any size
to enable private investment at a much larger scale.
A new Ministerial determination has been published for over 18 000 MW
of new generation capacity from wind, solar and battery storage.
The pipeline of private-sector embedded generation projects has grown
to over 100 projects, with total capacity of more than 9 000 MW.
19 projects from Bid Window 5 have signed project agreements to
supply 1 800 MW of solar and wind capacity, and a further six preferred
bidders from Bid Window 6 will provide 1000 MW of capacity.
An additional 300 MW of power has been imported from neighbouring
countries, with work underway to increase imports from the region.
Eskom has launched a Standard Offer Programme to purchase up
to 1000 MW of power from companies that have existing generation
capacity for a period of three years, as well as an Emergency Generation
Programme to purchase additional power when the grid is constrained.

Various actions have been completed to streamline authorisation

The short-term objective
of the Energy Action Plan is
to reduce the severity and
frequency of load shedding
through immediate
measures to improve the
performance of Eskom’s
existing power stations and
stabilise the energy system.
processes for energy projects:
Our long-term objective
is to end load shedding
altogether and achieve
energy security by adding
as much new generation
capacity to the grid as
possible, as quickly as
possible.
– Transmission infrastructure has been excluded from the need
to obtain an environmental authorisation in areas where the
environmental impact is low.
– The timeframe for environmental authorisations has been reduced
to 57 days for projects gazetted as Strategic Infrastructure Projects.
– The timeframe for registration with NERSA has been reduced from
four months to an average of 19 days.
– The timeframe for grid connection has been reduced from nine
months to six months.
– The timeframe for land-use authorisations for energy projects has
been reduced from 90 to 30 days.

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 ROADMAP TO END LOAD SHEDDING
Remaining Large-scale
Bid private
Renewables Window 5 sector
Imports from Rooftop Bid projects investment
neighbouring solar Window 5 1 115 MW through
Municipal
countries >850 MW 794 MW market
procurement Battery
300 MW - reforms
1 500 MW storage
1 625 MW >9 000 MW
bid window
Demand 513 MW
response Renewables
and Emergency Bid
Kusile Units Window 6 New
energy power Additional pumped
1,2,3 and 5 efficiency projects 1 000 MW
2 880 MW demand storage
~250 MW ~775 MW response 4 000 MW
~1 200 MW

2023 2024 2024+

More private
embedded
generation Eskom
BESS
2 125 MW land lease
Phase 1 Just Energy Additional
Standard projects
~200 MW Transition bid windows
offer and 2 142 MW
projects & for solar,
emergency Medupi Unit BESS Phase 2 wind
generation Surplus 4 and 238 MW and gas
programme capacity Kusile Unit 6 9 500 MW New gas
up to from 1 520 MW
1 350 MW existing facilities at
(starting 2023) IPPs Richards Bay
Private and/or
~70 MW
sector Mossel Bay
embedded 3 000 MW
generation
projects
1 597 MW

* Actual capacity depends on multiple factors including market response. This is an

Improved performance of existing power stations ~6000 MW illustrative timeline of when additional power is expected, and is subject to revision.

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OVERVIEW OF PROGRESS AFTER SIX MONTHS “Eskom will implement
An incentive-based (R/MWh) demand
a programme that
response mechanism has been
encourages efficient energy developed and will be launched in
OBJECTIVE 1: use by consumers to reduce January 2023 alongside a national
demand at peak times.” campaign to encourage energy
Fixing Eskom and
improving the efficiency.
performance of existing ate
power stations “We will use clim The JET Investment Plan has been
din g pro vid ed through
fun
st En erg y Tra nsition endorsed by Cabinet and will enable
the Ju
to inv es t in the additional funding to be allocated
Partnership
e power
se grid and repurpos for strengthening transmission
“Eskom will increa stations that have
reached
d for infrastructure.
the budget allocate Eskom has increased outage funding the en d of the ir live s.”
ma int en an ce to
critical for the current financial year from Eskom has finalised its Transmission
ility of
increase the reliab R8.2 billion to R9.5 billion. Development Plan for 2023 to 2027.
pacity.”
its generation ca
Weekly meetings are being held “Eskom will be Solar, wind, gas and storage projects
between Eskom and National Treasury constructing its first
“We are cutting red tape are under development at nine stations.
that has made it difficult to enable more agile procurement. solar and battery storage
projects at Komati,
Projects at Komati, Sere and Lethabo
for Eskom to buy Exemptions have been provided Majuba, Lethabo and are expected to connect to the grid in
maintenance spares and
from local content designations for several other stations.” 2023.
equipment within the
required period to effect equipment such as transformers
repairs.” and insulators, to enable expedited
procurement. OBJECTIVE 2:
18 skilled specialists have been Accelerating private
“The utility is recruiting brought back into Eskom to date, investment in
skilled personnel, including including three appointments of former generation capacity
former senior Eskom plant Eskom employees at power station
managers and engineers manager level for Kendal, Koeberg and
from the private sector.” “Last year we announced Since the licensing threshold was
Medupi. the raising of the licensing raised to 100 MW in October 2021, the
threshold to 100 MW.
More than 1000 people have Following the success of this
pipeline of private sector projects has
offered their skills through Eskom’s reform and the enthusiasm grown to over 100 projects with more
crowdsourcing platform. shown by the private sector, than 9 000 MW of new capacity.
we will remove the licensing
threshold for embedded Schedule 2 has now been amended to
Several law enforcement and security
generation completely.” remove the licensing requirement for
agencies are working together to
generation projects of any size.
ice address sabotage, theft and fraud at
African Pol
“The South t up a Eskom.
s se ial
Service ha ent tabling spec
w enforcem A total of 67 cases are on the court roll “We will be en t Work is underway to develop an
special la kom in legislation in
Pa rli am
he lp Es and three have been finalised with a ba sis Omnibus Bill that will incorporate
team to d on an ex pe di te d
g crime an the legal an
d the required legislative amendments
confrontin conviction. to address
” to new
corruption. regulatory ob
st ac le s (where processes cannot be waived or
Arrests have been made for theft and capa ci ty fo r a
sabotage at Camden, Matla and other generation streamlined under existing legislation).
pe rio d. ”
limited
power stations.

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OVERVIEW OF PROGRESS AFTER SIX MONTHS Timeframes have been significantly
“I have instructed
entities reduced for regulatory approvals:
departments and
iew all ex ist ing time
to rev • Land-use authorisations for energy
d to en su re we
frames an
tions projects are being prioritised
process all applica
Various actions have been completed .” (timeframes have been reduced from
on an urgent basis
“We will in the meantime to streamline authorisation processes 90 to 30 days).
tain
waive or streamline cer for energy projects, including:
regulatory requirements • Registration process has been
where it is possible to • Issued notice to exclude transmission significantly simplified (timeframes
do so within existing infrastructure from the need to obtain reduced from four months to
s
legislation. This include an environmental authorisation 19 days).
reducing the regulatory
country-wide in areas of low and
requirements for solar • Embedded generation projects have
projects in areas of low medium environmental sensitivity and
ntal been gazetted as Strategic Integrated
and medium environme in strategic transmission corridors
Projects, reducing the timeframe for
sensitivity.”
• Issued notice to exclude solar PV environmental authorisation to 57 days.
facilities from the need to obtain
• Eskom has reduced timeframes for
environmental authorisation
access to the grid.
within areas of low and medium
environmental sensitivity for public
comment
• Notice to expand scope and threshold
of general authorisations for wind
and solar projects to be published for OBJECTIVE 3:
public comment
Accelerating new
generation capacity
A One Stop Shop is being established
lishing a as a single entry point for energy
“We are also estab
gle po int of en try for all projects through Invest SA.
sin
plications
energy project ap
tion of A business case has been developed
to ensure coordina A total of 162 MW of surplus capacity
es across outlining resource and operational
approval process “As an immediate measure, has been identified from existing
government.” requirements. surplus capacity will be
IPPs. Work is underway between the
bought from existing
independent power IPP Office and generators to unlock
producers.” this capacity, including additional grid
strengthening required.

purchase
“Eskom will also Eskom has launched a Standard
addit ion al en erg y
te Offer Programme to procure up to 1 000
from existing priva MW of power from companies which
ve
generators that ha
surplus power.” have existing generation capacity for a
period of three years.

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OVERVIEW OF PROGRESS AFTER SIX MONTHS
rt
“Eskom will impo
bouring
power from neigh
coun trie s throu gh the
Power
Southern African
Pool.”
“Eskom will also use
interim power solutions,
such as mobile generators,
to supplement current
generation capacity for a
limited period.”
“The relevant government
departments are working
together to ensure that
projects from Bid Window
5 of the renewable energy
programme can start
construction on schedule.
This includes taking a
pragmatic approach to the
local content requirements for
these projects, prioritising the
need to build new capacity as
quickly as possible.”
“The amount of new
generation capacity
procured through Bid
Window 6 for wind and solar
power will be doubled from
2 600 MW to 5 200 MW.”
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A Bilateral Power Import Programme has
been launched to secure imports of power
to the country from neighbouring countries.
So far, 200 MW has been secured as of
September 2022 and a further 1 000 MW
has been identified for 2023.
Eskom has launched an Emergency
Generation Programme to procure
additional power when the grid is
significantly constrained.
Designated local content for solar
panels has been reduced from 100%
to 30% to alleviate constraints.
19 out of 25 projects from Bid Window
5 have signed project agreements to
date for 1 800 MW of new capacity, and
will now proceed to financial close and
construction.
A revised RFP for Bid Window 6 was
published to increase the capacity
procured.
Five preferred bidders have been
selected to date to provide 1000 MW
of solar power. Several wind projects
could not be accepted as the available
grid capacity has been taken up by
private sector projects, which are now
proceeding to construction.
uest
“We will release a req
tery
for proposals for bat
storage by September
this The RFP for battery storage has been
uest finalised and will be released to the
year, and a further req
n as
for gas power as soo market shortly. An RFP for gas power
possible thereafter.” will follow by March 2023.
“The Minister of Mineral
A Ministerial determination was
Resources and Energy will
issue a determination for the published on 25 August 2022 for over
remaining allocations in the 18 000 MW of new generation capacity
Integrated Resource Plan from wind, solar and battery storage
2019, and will open further (the remaining allocation in the IRP
bid windows on an expedited
2019).
basis.”
“To ensure effective
planning, the country’s The IRP 2019 is being reviewed, with
Integrated Resource Plan a completion target of March 2023, to
is being reviewed to reflect
update assumptions regarding energy
the need for additional
generation capacity and our availability and technological changes.
climate commitments.”
OBJECTIVE 4:
Enabling businesses and
households to invest in
rooftop solar
Eskom has submitted a net metering
“To incentivise greater tariff for residential customers to
r,
uptake of rooftop sola NERSA for approval.
s
Eskom will develop rule
and a pricing structure
– Work is underway to develop a net
ff
known as a feed-in tari billing framework for municipalities
– for all commercial and to enable customers to feed electricity
s on
residential installation
from rooftop solar installations onto the
its network.”
grid.
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OVERVIEW OF PROGRESS AFTER SIX MONTHS

OBJECTIVE 5:
Fundamentally
transforming the
electricity sector

“We will soon be

appointing boards for
The appointment of an independent
the transmission and board for the transmission entity will
generation entities.” be finalised by the Minister of Public
Enterprises.

“Broader reforms to
establish a competitive The Electricity Regulation
electricity market will be Amendment Bill, which will establish
expedited through the
finalisation of the Elec
tricity an independent transmission and
Bill system operator and a competitive
Regulation Amendment
to enable private-sector electricity market, has been finalised
investment.” for submission to Cabinet in
January 2023.

“To ensure that these

measures are implemented in
a coordinated manner, NECOM has been established
I have established a National with nine workstreams and
Energy Crisis Committee.
is fully operational.
The NECOM will draw on
the best available expertise
from business, labour,
professional engineering
entities and community-based
organisations.”

www.stateofthenation.gov.za

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