Resources How to Tender Tender Articles Tender Sectors Tender News

Sarec calls Eskom out over PPAs

The SA Renewable Energy Council (Sarec) slammed Eskom, saying the parastatal continues to resist signing outstanding power purchase agreements (PPAs) with renewable energy producers, despite President Jacobs Zuma confirming that Eskom would do so at his State of the Nation address. Sarec has also come out in strong opposition to what it has termed the “blatant distortion” of facts associated with the cost of renewable power purchases. “Eskom is without a doubt being opportunistic in its attempt to mislead and deceive the public, to serve its bid for nuclear power,” Sarec chairperson Brenda Martin said. Eskom has refuted this. Before PPAs can be signed, Eskom must finalise budget quotes for each independent power producers (IPP).

This is Eskom’s quoted cost to connect the new plant to the national grid. All such budget quotes expired as Eskom refused to move forward with the process, Sarec says. “Despite the president’s injunction, Eskom has yet to issue a single IPP with an updated budget quote. Eskom managers’ report that the Eskom board and interim CEO have yet to approve the formal issuance of these quoted. “Of even more concern are emerging reports that budget quotes may only be approved if the cost of connection is significantly increased (in one case, doubled) compared to the original quotes and of even greater concern on condition that renewable tariffs are capped at 62c/kWh.” Sarec says its legal opinion indicates that ministerial determinations are binding on Eskom and the utility has no discretion to impose further conditions on preferred bidders, or to negotiate tariffs following a completed competitive tender process.

“South Africa cannot afford to suspend the entry of R58 billion into the economy and the creation of 13 000 much-needed jobs.” Eskom said it will sign the renewable energy projects as envisaged by the government. “To date, Eskom has signed 64 PPAs for a total of 4 000MW under the RE-IPP programme and two PPAs for the open-cycle turbines for a total of over 1 000MW,” Eskom said. In addition to the signed PPAs, there are 2 383MW of renewable PPAs remaining to be signed, which have been approved by Eskom Board’s investment and finance committee, and for which the necessary approvals have been received from the minister of public enterprises. “Nersa (National energy Regulator) has provided the necessary assurances for cost recovery of these PPAs. Eskom’s primary objective has always been to deliver reliable energy supply at the least cost to the consumer.”

Source: www.iol.co.za

BACK TO NEWS

Sarec calls Eskom out over PPAs

Latest News