Negotiating sustainable off-take agreements between Eskom and alternate electricity suppliers in South Africa.
Date
2016
Authors
Nkwana, Kenneth
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Abstract
Eskom, a state owned power utility, is both vertically integrated (generating,
transmitting and distributing electricity) and a monopoly supplying 95% of
electricity in South Africa. In recent years, Eskom has not been able to meet the
demand for electricity, resulting in power outages known as load-shedding.
Whilst Eskom builds new power stations, the government has encouraged
electricity supply from independent alternate suppliers of electricity, also known
as independent power producers (IPPs). Many IPPs have embraced the
opportunity and have off-take (power purchase) agreements with Eskom
however, not all have succeeded.
This qualitative research focuses mainly on renewable sources of electricity,
especially wind energy, solar (concentrated solar and photovoltaic)
technologies.
The research scrutinises the power generation model in South Africa and
studies key factors, risks, constraints, issues and opportunities in the process of
negotiating sustainable off-take agreements between Eskom and IPPs. The
report then recommends the best approach to long-term sustainability of
electricity supply in the country, including migration of base load electricity
provision from coal and other fossil fuels to more sustainable wind and solar
technologies. Also recommended are areas for further exploration, not covered
by this research in detail, include the best model of electricity supply in South
Africa; whether Eskom should remain the system owner and the feasibility of
the energy internet in South Africa.
Description
MBA
Keywords
Eskom (Firm) .Electric power distribution -- South Africa. Energy policy -- South Africa.