South Africa has confirmed that national power utility Eskom would sign the outstanding power purchase agreements (PPAs) for renewable power projects approved in the most recent rounds of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP). The country will also remain committed to its IPP programmes, that would be extended to coal- and gas-fired projects.
In mid-2016, Eskom announced that it would not sign further PPAs until receiving a governmental guidance on the matter. The company claimed that the projects would raise electricity tariffs for end customers and that they would not be necessary until 2021, in a context of lower power demand, stabilised coal-fired power supply and new Eskom's capacities soon to be commissioned. This unilateral decision left nearly 40 projects in limbo.
In the last decade, Eskom struggled to meet rising power demand in South Africa, due to a lack of working generation capacities. The utility had to schedule rolling blackouts until 2006; after an 8-year interruption, blackouts resumed in March 2014 after technical problems at two coal-fired power plants and massive load shedding lasted until late 2015. Delays in the construction of new power plants also contributed to limit available capacity.
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