Executive summary
South Africa’s electricity supply crisis has seen significant improvements, but challenges remain. Structural and commercial changes initiated by the crisis are driving ongoing reforms in the electricity sector. The crisis has redefined relationships between the state, Eskom, transmission system operators (TSOs), power consumers, and the private sector. After experiencing 262 days of loadshedding in 2023, the situation improved in 2024 with no power cuts in the second and third quarters. Eskom exceeded maintenance targets and improved the energy availability factor (EAF) of its plants from 57% to 67% by July 2024, though still below the 75% target in the 2019 Integrated Resource Plan (IRP). Several factors contributed to this improvement. Lower demand due to warm winter temperatures and increased self-generated solar power played a role. There was a significant increase in small- scale embedded generation (SSEG) and solar PV installations, with 5.5GW of rooftop solar added by December 2023. Additionally, new capacity additions included 3,461MW added to the grid in 2023 and 3,091MW in the first eight months of 2024. Kusile Coal units returned to service, adding 800MW to the grid. Despite these improvements, electricity supply remains unstable due to constrained generation capacity. Excess demand is managed through load reductions, imports, and open cycle gas turbines (OCGTs). The lack of grid capacity, particularly in Northern, East, and Western Cape, threatens the integration of new projects. This issue led to fewer projects being tendered under REIPPPP’s bid windows. Looking ahead, the next phase of on-grid private- sector funded renewable energy additions has the potential to transform the electricity supply industry, contingent on the development of necessary transmission infrastructure. The Government Energy Action Plan (EAP) projects the addition of 38GW of capacity between 2024 and 2030, with significant contributions from the private sector and renewable energy sources.
South Africa aims to reduce greenhouse gas emissions to 350-440MtCO 2 e by 2030. Eskom requires approximately ZAR1.5 trillion to develop new energy infrastructure by 2030. While South Africa has made strides in addressing its electricity supply crisis, sustained efforts and investments are crucial to achieving stable and reliable power supply, particularly through renewable energy and improved grid infrastructure.
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South Africa’s Energy Prospects
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