Wind energy 40% cheaper than coal

Cape Town - Renewable energy is supplying electricity to South Africa at prices that are around 40 percent cheaper than electricity prices forecast for the Medupi and Kusile coal powered plants which are still under construction.

Delegates at the Windaba conference in Cape Town, organised by the SA Wind Energy Association (Sawea) and the Global Wind Energy Council, heard that the average price for wind energy in South Africa had come down from R1.41 a kilowatt-hour in 2011, when the renewable energy programme began, to 71c a kilowatt-hour this year - a decrease of 50 percent.

Cranes are seen beside the Medupi power station in Lephalale. Picture: Sydney Sheshibedi. Credit: REUTERS

Construction times for renewable energy projects was on average less than two years.

The Treasury said by October this year, the 92 renewable energy projects selected by government and built by the private sector, had attracted R193 billion of investment. Of this, 28 percent came from direct foreign investment.

Sawea’s chief executive Johan van den Berg told delegates that wind energy was saving the country more than it cost.

A CSIR study established that wind energy had produced a net saving for the country of R1.8 billion in the first half of 2015. Collectively wind and solar had saved R4bn from January to June this year.

Van den Berg said the country’s electricity generation would be constrained for some time to come. Wind energy was playing a part in helping avoiding load shedding.

The National Development Plan had stressed the need for adequate energy, and had also focussed on the need for change and collaboration. He said the renewable energy sector was providing cheap electricity and creating change through collaboration between government and the private sector.

“We are proud that wind is costing the country next to nothing,” Van den Berg said.

Karén Breytenbach, head of the Department of Energy’s independent power producers’ office, said when the government had developed the renewable energy programme, one of the main criteria had been to ensure the it would bring associated social-economic development.

The programme had been designed with this in mind and communities living within a 50km radius of renewable energy projects got a minimum of a 2.5 percent shareholding in the projects. However, the average shareholding in renewable projects was around 10.5 percent, four times higher than the obligatory minimum.

To date R91.1 billion had been committed to development initiatives under the renewable energy programme.

“This development happened in areas where nothing had happened for a very long time, and suddenly there was a lot of economic development. We don’t have a perfect programme - we’re learning with every bid window - but we have made a lot of impact,” Breytenbach said.