South Africa faces the dual challenge of pursuing economic growth and protecting the environment. South Africa has set up the institutional infrastructure for renewable energy projects which are beginning to pay dividends in the form of big investments from foreign as well as local investors and development of commercial solar, wind and biomass energy projects. The South African government’s recent adoption and implementation of the Renewable Energy Feed-in-Tariffs undermines the state’s support for regulatory drivers to bolster cleantech sector.
Cost reduction and energy security have been the main drivers for corporate renewable energy investments in South Africa. In 2009, the cleantech investment in South Africa was US$ 125 million, which was comparatively much lower to that in developing countries like India and China. Eskom, under the Eskom
Renewable Energy Investment Project (EREIP), has proposed the first-ever commercial scale Concentrated Solar Power plant in sub-Saharan Africa and the first utility-scale wind power plant in South Africa. The project is estimated to cost over US$ 1.2 billion, of which African Development Bank would contribute up to US$ 260 million and co-finance with Clean Technology Fund (CTF) resources of US$ 100 million. Other financiers include the World Bank, European Investment Bank, Agence Française de Développement (AFD) and the German Development Bank (KfW).
Eskom has proposed the first-ever commercial scale Concentrated Solar Power plant in sub-Saharan Africa and the first utility-scale wind power plant in South Africa, which is estimated to cost over US$ 1.2 billion
The Clean Technology Fund is a multi-donor US$ 500 million trust fund created in 2008 to provide scaled up financing for demonstration, deployment and transfer of low carbon technologies in South Africa. South Africa’s first, specialized, private equity clean technology fund, Evolution One Fund, has reached its final closing after raising US$92 million from local and foreign investors. This capital is to be invested into equity in clean technology projects and enterprises including new energy and environment focused technologies in South Africa and across the Southern African Development Community.
The European Investment Bank (EIB) is also providing US$ 52 million loan to FirstRand Bank to promote energy efficiency and renewable energy projects across South Africa. The package marks the first dedicated energy efficiency loan in South Africa made by the in-house bank of the European Union.
CDM has great potential in South Africa as the country ranks as a foremost emitter of greenhouse gases. To promote clean investments, the South African government has introduced a tax exemption for CDM revenues. This measure is also aimed at improving South Africa’s attractiveness for CDM projects. Of the 4,869 projects in the 2009 CDM pipeline, South Africa has managed to attract only 29. IPP projects can also include CDM components to increase profitability.
South Africa is acknowledged to be the most preferred partner country due to its high fossil fuel content of its electricity generation. The high emissions from the use of coal coupled with its abundant renewable energy resources makes South Africa a favorable project development and investment destination.
Salman has successfully accomplished a wide range of projects in the areas of biogas technology, biomass energy, waste-to-energy, recycling and waste management.
Salman has participated in numerous national and international conferences all over the world.He is a prolific environmental journalist, and has authored more than 300 articles in reputed journals, magazines and websites. In addition, he is proactively engaged in creating mass awareness on renewable energy, waste management and environmental sustainability through his blogs and portals.
Salman can be reached at firstname.lastname@example.org or email@example.com.
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