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12 September 2023

Eskom has announced continuous stage 6 loadshedding until further notice.  This is due to further delays in returning generating units to service at Kendal, Matla and Matimba power stations.  In its update earlier today, Eskom said its breakdowns were at 16.784MW of generating capacity, while capcity offline for maintenance was 4.987MW.  The state-owned power utility escalated its level of loadshedding twice on Tuesday - first announcing stage 5 as four generating units broke down, then later issuing a timetable planning an alternating schedule of stage 5 and stage 6 for the rest of the week.  Eskom said that, besides the breakdowns, it needed to replenish its emergency generation reserves.  It had also increased planned maintenance.  Although three generating units at Camden, Duvha and Kendal power stations were returned to service over the past 24 hours, four generating units at Duvha, Grootvlei, Kendal and Matla power stations were taken offline for repairs.  Eskom said it anticipating an evening of 29.542MW and appealed to the public to reduce demand by switching off non-essential appliances.  On Monday, 11 September, the power utility increased loadshedding to stage 5 at 22:00 and returned to stage 4 at 05:00 on Tuesday.  At the time, Eskom said it was forced to increase loadshedding to replenish pumped storage dam levels during the night and to ensure it had sufficient emergency generation reserves.  Before that, the power utility upped loadshedding to stage 4 at noon on Monday, following the breakdown of three generating units.  This was also shortly after Eskom announced it would follow an alternating schedule of stage 3 daytime loadshedding and stage 4 over the evening peak and early morning.  Its original plan was to reduce daytime loadshedding to stage 2 by Wednesday.


5 September 2023

Electricity Minister Kgosientsho Ramokgopa said on Tuesday "there will be no shortcut to the ending of loadshedding", amid rolling Stage 6 power cuts which are likely to continue for the rest of the week.  Ramokgopa said Eskom had begun to ramp up planned maintenance "to build a degree of resilience in the system", after it had been lowered during winter due to the increased demand for electricity.  He said that part of the reason Eskom has seen a deterioration in generating capacity is that it had not been sticking to performing planned maintenance over the years.  "We are going to stick to planned maintenance, we're going to stick to philosophy maintenance.  We do accept that, in the short-term, it's going to result in the possibility of intensified loadshedding.  "I'm saying possibility because, if that ramped-up planned maintenance... is accompanied by unplanned capacity loss factor - that is the other units that are tripping - then it means there will be an intensification of loadshedding.  Which is essentially the situation that we find ourselves in", said Ramokgopa.  Over time Eskom's generating units have been exploited because of lack of investment in planned maintenance, owing the utility's balance sheet being "severely compromised", he said.  What has helped us a lot is the fiscal injection from National Treasury.  Now, we have a degree of wiggle room from a financing and a funding point of view, to be able to direct a significant amount of resources towards maintenance.  "Previously with that constrained balance sheet... Something had to give and what was being compromised over that period was our investment in maintenance, and that has caught up with us", he said.  Eskom's head of generation, Bheki Nxumalo, said Stage 6 loadshedding is likely to continue for the rest of the week, and be eased off towards the weekend, as some units begin to return to service.  "Towards the end of this week we should be in a position to start reducing the stages from the current Stage 6 and... we would've recovered as well on our pump storage reserves", he said.


23 February 2023

2023 Budget Speech - Finance minister Enoch Godongwana has announced that National Treasury will be providing tax incentives and tax relief to South African businesses and households to encourage a rapid move to renewable energy.  This will include a massive rebate for businesses launching renewable energy projects and a smaller incentive for private households.  Through these two incentives, the Treasury said it would be offering R4 billion in relief provided for individuals that install solar panels and R5 billion to companies through an expansion of the renewable energy tax incentive. 


For private households, individuals who install rooftop solar panels from 1 March 2023 will be able to claim a rebate of 25% of the cost of the panels, up to a maximum of R15,000.  "This can be used to reduce their tax liability in the 2023/2024 tax year.  This incentive will be available for one year", the minister said.  To qualify, the solar panels must be purchased and installed at a private residence, and a certificate of compliance for the installation must be issued from 1 March 2023 to 29 February 2024.  The rebate is only available for solar PV panels, and not inverters or batteries, to focus on the promotion of additional generation.  Only new and unused solar PV Panels qualify to ensure that the capacity is in addition to what the country already has in place.  The panels can be installed as part of a new system, or as an extension of an existing system.  Only solar PV panels with a minimum capacity of 275W per panel (design output) qualify for the rebate.  Other components of a system - batteries, inverters, fittings or diesel generators - and installation costs do not qualify.  Portable panels will also not qualify.  Solar PV panels must be installed at a residence that is mainly used by an individual for domestic purposes.  The installation will have to be proved  with a certificate of compliance in terms of the Electrical Installation Regulations, 2009 to ensure safety of the installation and compliance to electric regulations.  The solar PV Panels must form part of a system that is connected to the mains distribution of the private residence.

Business, according to the minster, from 1 March 2023, will be able to reduce their taxable income by 125% of the cost of an investment in renewables.  "There will be no thresholds on the size of the projects that qualify, and the incentive will be available for two years to stimulate investment in the short term", he said.  The current incentive allows businesses to deduct the costs of qualifying investments over a one- or three-year period, which creates a cash flow benefit in the early years of a project.  Businesses are able to deduct 50% of the costs in the first year, 30% in the second and 20% in the third for qualifying investments in photovoltaic (PV) projects above 1 megawatt (mW).  Investors in PV projects below 1 mW are able to deduct 100% of the cost in the first year.  Under the expanded incentive, businesses will be able to claim a 125% deduction in the first year for all renewable energy projects with no thresholds on generation capacity.  The adjusted incentive will only be able for investments brought into use for the first time between 1 March 2023 and 28 February 2025.  "For a business with positive taxable income, the deduction will reduce its tax liability", Treasury said.


7 February 2023

Eskom has announced that it will no longer reduce loadshedding from Wednesday.  Instead, loadshedding will remain at stage 4 between 16:00 and 05:00, and stage 3 from 05:00 to 16:00 daily until further notice.  Previously, Eskom had said it hoped to reduce power cuts to an alternating schedule of stage 2 and stage 3 loadshedding.  This comes after Bloomberg reported that the state-owned power utility had implemented 100 consecutive days of power cuts since 31 October 2022.  Popular loadshedding schedule tracker and notification app EskomSePush reported on Sunday that Eskom had set a new record of 984 continuous hours of loadshedding.  This was after Eskom briefly suspended power cuts for 11 hours during the day.  It resumed loadshedding at stage 2 from 16:00 for the evening peak.  By Monday morning loadshedding had escalated to stage 3, with stage 4 scheduled for the evening peak.  The South African Reserve Bank estimates that stage 3 loadshedding costs the economy around R204 million daily.  Stage 6 power cuts detract an estimated R899 million rand from the economy per day.



30 January 2023

What to look for in solar PV installers and the potential pitfalls of using "fly-by-night" companies

[Ryk van Niekerk] Every evening for the past couple of weeks we have chatted about loadshedding.  Loadshedding hurts not only companies, but the disruptions are obliging households and businesses to plan ahead, and the most popular solution becomes acquiring an inverter or a solar energy system.  The demand for such solutions has increased dramatically over the past couple of years, and is expected to escalate for the next couple at least.  This increasing demand has resulted in many unqualified or fly-by-night installers, who do not always install the best equipment or solutions, popping up.  They can take shortcuts with the installation, resulting in the owner being saddled with problems afterwards.  This evening we will be chatting about how households and businesses should approach the matter.


[DeVilliers Botha, management committee member of the South African Photovoltaic Industry Association (SAPVIA)] This is a growing problem amid the escalating demand.  But the problem has been coming for quite a while, and I can refer back to 2015 when we as the industry organisation wanted to start writing the South African National Standards (SANS) and realised there were many former, what one might call "solar geyser installers" on the rooftops.  These then migrated to solar systems, solar power systems, electrical systems.  The installers are essentially plumbers doing the electrical work.  We have recognised the growing problem of many people coming on board, from so-called "drone pilots" to former lawnmower service providers, all saying "Great, let's buy a bakkie and do the job".  So we have a problem, but we all recognise it as an opportunity for training and application.

[Van Niekerk]  Let's say a household says it can no longer take this loadshedding, and plans to install a solar energy system.  The owner might draw from savings, or even borrow money from the bank.  These things are expensive - we are talking about R70,000 to R80,000 plus.  What should that household then do to make sure it gets the best system for the money available?

[Botha] I would start asking who will do the job, and what that person's qualifications are - not only the company's qualification, but the qualifications of those in that company.  Typically, there should be an electrician who can provide the necessary COC (certificate of compliance).  We know that the COC is essential in the event of something going wrong or should you wish to sell your house.  The important thing is, should a fire break out and insurance becomes involved, the insurer will immediately request the COC for the system and ask could an illegally installed system not be the cause of the fire?  So it's critical to ask for that COC and to make sure everything is above board.  Also make sure that person is more than an electrician to issue a COC, but one who has received further training in the industry.

[Van Niekerk]  Is it a very complicated system to install in a typical home?  Is it difficult, do you really have to know what you are doing?

[Botha]  The setting up aspect is extremely important.  This week alone I happened to see a news report in which a number of retailers were advertising how they are importing systems.  But those systems have not been designed to meet specific client needs.  This week I happened to hear a conversation taking place at a sportsground where a guy said he just wanted to "pull the load", the expression we use today, for his lights and his fridge.  The other guy said, "Man, my house is off grid".  Those are two totally different scenarios.  You need a qualified person for the job.  An engineer is sometimes required to do the design.  It's not like saying "I'm just going to the shop to buy another lawnmower, and I'll bring it home and set it up myself and have it working within two hours".  You really have to make sure that the product meets your needs, and that it matches what you already have at home and the load you wish to pull.  Then there is the size of the batteries.  Many people say "The system has not been providing what I wanted".  When properly technically authorised people from SAPVIA go and inspect, they discover that the system was never designed for that application, but that the customer wanted to spend less than was needed for an appropriate system.

[Van Niekerk]  A friend told me a while ago that he had an inverter, and wanted to install solar panels.  The installer came out and said that the batteries he had purchased at great expense were the wrong batteries.  How can one make sure that the equipment being installed is really good and not just "cheap Chinese rubbish"?

[Botha]  First, I'd like to correct that statement.  Not everything coming from China these days is bad.  I know that in the vernacular we used to say that.  But I think first let us look at the guarantee.  We are all on Google these days, and we now use it as a verb.  When a supplier gives you a quotation, research the components he specified, no matter what the brand.  Go on the internet, Google that product, examine the guarantees, and check the good and bad comments from other consumers about that product.  I would typically say, "Really try to keep to products that have at least a 5-year guarantee with regard to turnover.  And then, as to the batteries, look for something with at least a 10-year guarantee."  It would be wrong to mention battery brand names.  But go and look at products that are assembled locally.  There are several, and they usually give a 10-year guarantee on their batteries.

[Van Niekerk]  I agree that the guarantee is very important.  But when looking at these types of systems, it could be a case of "BUY CHEAP, BUY TWICE".

[Botha]  For sure.  We have regularly seen that.  It could mean having to replace your entire system.  As SAPVIA and having had customers on the solar side come in with systems where we can reuse almost nothing we find on the premises, and we have to start from scratch, then you land up paying double for the same solution.  That is something we don't want to see as an industry.  If people want to protect themselves against loadshedding, they need to do it in a sensible way.

[Van Niekerk]  So the message is to do your homework and don't necessarily accept the first quotation..  These things are expensive, and you can save yourself a lot of future problems. 


22 January 2023

Eskom will implement permanent loadshedding in South Africa for the next two years, the state-owner power utility's chairman Mpho Makwana has said.  In a media call on Sunday, 22 January 2023, Makwana warned that South Africans should expect continuous stage 2 and stage 3 power cuts for the next 24 months.  "We want to create some predictability", Makwana said.  "Shuttling from one stage to the other is never good."  However, outgoing Eskom CEO Andre de Ruyter later clarified that continuously implementing a specific stage of loadshedding would not be possible.  Higher stages might sometimes be necessary, and if Eskom's generating unit breakdown situation improves, lower stages could be possible.  The state-owned power utility's power station general manager, Thomas Conradie, also later said they hope to decrease day-time loadshedding to stage 1 in the coming week.  Makwana said permanent loadshedding would form part of Eskom's plan to increase its Energy Availability Factor (EAF) to a point where it could stop loadshedding within the next 24 months.  "The global average for EAF is about 86%.  We're looking to grow from our current 58% EAF to 70% in the next two years", said Makwana.  The planned journey to 70% is hoped to take place on the following timeline:

  • 60% EAF - end March 2023

  • 65% EAF - end March 2024

  • 70% EAF - end March 2025

Eskom CEO Andre de Ruyter added that while there has been much speculation about stage 8 loadshedding, this is no longer a likely scenario.  "The possibility of stage 8 loadshedding is receding, which is comforting and positive", said de Ruyter.  "However, there is always an inherent risk, and for that purpose, we have to protect our diesel reserves."

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