South Africa has awarded 1,760 megawatts of renewable energy projects as part of its ongoing effort to reduce reliance on coal for electricity generation, Bloomberg reports.
However, the country’s constrained transmission grid has limited the scope of its ambitions, Electricity Minister Kgosientsho Ramokgopa announced on Monday.
The government received 40 bids for 1,800 megawatts of power, but only eight bids were successful, mainly due to a lack of grid capacity in the intended project locations. “The issue is not a lack of interest,” Minister Ramokgopa told reporters, “but rather, the capacity of our grid.” This highlights a significant hurdle in South Africa’s transition to cleaner energy sources.
The nation has a 1.5 trillion-rand ($82 billion) five-year plan to develop renewable energy, green hydrogen, and electric vehicle industries. South Africa has also secured $9.3 billion in climate finance from developed nations through the Just Energy Transition Partnership, demonstrating international support for the country’s green initiatives.
To address grid limitations, the country is also working on a 390 billion-rand plan to expand its transmission network. The government recently solicited information from private investors regarding the development of the grid, with requests for proposals on transmission projects likely to be issued at the end of 2025, according to Minister Ramokgopa.
The awarded projects come from the seventh bid window of South Africa’s renewables plan. Infinity Power Holding SA is the primary developer for six of these projects, while Mulilo Renewable Project Developments and Scatec Solar Africa Pty Ltd. will each develop one project. The projects range in size from 150 megawatts to 240 megawatts.
South Africa currently relies on coal for over 80% of its electricity generation. The state-owned power utility, Eskom, which provides about 90% of the country’s power, has struggled with maintenance and new plant construction, leading to widespread power outages. A new management team at Eskom has been working to improve the utility’s operations, and blackouts have become less frequent since March.
Notably, the government did not award any of the 3,200 megawatts of wind energy that it sought, due to the bids being too expensive.
In addition to the renewable energy projects, the government appointed eight preferred bidders for 615 megawatts of battery-storage energy projects. These battery projects will be located at Eskom sites in the North West, Gauteng, and Free State provinces, with Mulilo leading five of the projects, AMEA securing two, and EDF securing one. Each project is some 77 megawatts in size.
