Independent Power Producers (IPPs) in South Africa could soon see their applications for new renewable energy projects approved in record time if the government succeeds in implementing the newly-launched facility to fast-track processes.
The Minister of Trade, Industry and Competition Ebrahim Patel launched the Energy One-Stop Shop (EOSS) and the Energy Resilience Fund on Thursday to mitigate the ongoing energy crisis as part of the Energy Mitigation Strategy.
The EOSS is expected to streamline regulatory processes for private investment in electricity generation, facilitate pre-investment screening for all energy projects and fast-track the approval of energy applications.
This is part of the government’s wider efforts to refocus resources and increase the supply of energy available to the grid, mainly through additional renewable energy.
Patel said the EOSS was developed to address a key constraint that energy developers face such as the many regulatory hurdles that slow down the approval of energy supply projects.
He said the EOSS and Energy Resilience Fund were critical steps towards alleviating the challenges faced by industries during this energy crisis.
“We are committed to fostering a resilient business environment and accelerating private-sector investment in electricity generation to secure a stable energy future,” Patel said.
“While the Presidency is exploring ways to simplify these processes, we have seen that having a dedicated resource available to the private sector, to address blockages, has worked in other parts of the economy.”
The EOSS facility is being rolled out in four phases, with the first phase including dedicated personnel, a website, a registration portal for energy projects and a mapped process showing where a project is in the approval processes.
The second phase of the facility will be scoping provincial and municipal processes and building capacity at these two spheres.
In phase three, a single, electronic application process will be put in place, with greater automated feedback, while the fourth phase will cover both immediate blockages and looking at a wider reform programme for the full projects in place.
Energy Council of South Africa CEO James McKay said the energy transition would be more challenging and expensive than was expected, and thus the country required all technologies, collaboration and significant investment.
“South Africa is re-shaping the regulatory landscape to facilitate the energy transition to distributed, decentralised and traded energy,” McKay said.
“There is significant reform still required, and the One-Stop Shop will play a significant role in developing this evolving landscape.”
The electricity deficit of 6 000MW has led to the establishment of a R1.3 billion Energy Resilience Fund that will be deployed through the Department of Trade, Industry and Competition (DTIC), the Industrial Development Corporation (IDC) and the National Empowerment Fund (NEF).
This comprises of targeted funding solutions for businesses affected by load shedding, including those operating in townships and rural areas, and to support the localisation of inputs.
The support is provided to assist companies with alternative energy solutions including inverters, batteries, related electrical wiring and components, solar energy systems and any other energy efficient interventions.
To date, the IDC has approximately 14 transactions being processed and 10 approved.
The acting deputy director-general of industrial financing at the department, Susan Mangole, said it acknowledged the need to assist businesses in alleviating the impacts of load shedding through the implementation of alternative energy systems or processes.
Mangole said the alternative energy interventions must be meaningful for a company to largely remain operational in times of load shedding.
“Entities supported through this scheme must retain the same number of jobs or increase jobs for the duration of the term of the funding,” Mangole said.
“In addition to this fund, the DTIC, through its infrastructure investment programmes, is supporting the expansion of South Africa’s alternative energy mix such as solar farm, biogas plant or hydrogen fuel projects.”
BUSINESS REPORT