South Africa is shooting up the global rankings in its investment in renewable energy for 2012 – punching way above its weight by moving into the top ten category.
South Africa has been one of the most aggressive investors in renewable energy over the past year, sharing its top ten status with countries like China, the US, Germany and Japan.
China is streets ahead of anyone in terms of investment over the past year, with the Asian giant ploughing US$ 64.7 billion into investment in renewable energy in 2012, nearly double that of the US and triple that of Germany.
But the Renewables 2013 Global Status Report shows that South Africa is holding its own, investing more than both Brazil and France in 2012, and ranking just below India.
The Department of Energy’s Renewable Energy Independent Power Producers Procurement Programme is propelling the growth, with the sector keenly awaiting the announcement on Tuesday October 29 of the preferred bidders for the programme’s third bid window.
Most of the investment has been wrapped around South Africa’s sun-drenched and wind-rich climate, with solar and wind power investors putting in a large slice of the bids. Fewer projects have been reserved for biomass, biogas and landfill gas.
The past year has seen at least 250 wind turbines under construction in South Africa, with CEO of the South African Wind Energy Association, Johan van den Berg, expecting South Africa to exceed the Department of Energy’s target to generate 1 850 MW of wind energy by 2030.
Ethiopia is still edging slightly ahead of South Africa in terms of its installed wind energy capacity, but a plethora of projects is likely to push South Africa into the number one spot [in Africa] very soon.
The Renewables 2013 report, released by the UN-backedÂÂ Ren21, said South Africa had made ‘a stunning leap’ in 2012, boosting its investment in renewable energy from a few hundred million dollars to US$5.7 billion.
Morocco and Kenya also upped their spending on renewable energy, with Morocco investing US$1.8 billion and Kenya going from almost zero in 2011 to US$1.1 billion in 2012.
While the continent has backed its oil and gas industries in the past, it’s starting to slowly ring the changes towards more renewable energy.ÂÂ Africa holds tremendous promise, with large areas of Southern and Northern Africa in particular known to have world-class solar resources.
Around 20 African countries now have formal renewable energy policies in place, a sharp hike over the past five years.
But the continent with the most promise also has the most catching up to do and is by far the least developed globally in terms of renewable energy.
About 70% of the population of sub-Saharan Africa don’t have access to electricity. Only around a quarter of Angola’s people have access to electricity, with people in Lesotho and Mozambique even worse off.
According to the report, rural electrification rates in North Africa remain the highest on the continent.
Renewable heating markets are warming up, with the report saying sub-Saharan Africa is producing more solar heat for domestic water heating per capita than regions such as Asia (excluding China) and the US and Canada.
China’s push on renewable energy is also being carried through to some African countries, where it is investing heavily in large hydropower projects in Ethiopia, Nigeria, the Sudan and Zambia.
South Africa has the opportunity to be pioneering on the continent, as its first grid-connected wind and solar power projects of 5 MW and larger get underway.
The Department of Energy estimates that by the end of its maximum 5 Window bid process, the IPP programme will attract project proposals to the value of R100 billion over its lifetime.
With all of the major South African banks involved as financiers, the IPP is also attracting some interesting foreign investors. Even search engine Google has jumped on board, investing R103 million in the Jasper power project, a 96 megawatt solar photovoltaic plant near Upington in the Northern Cape.
Chris Haw of the South African Photovoltaic Industry Association believes the renewable energy industry in South Africa is adapting well.
“People are becoming much more familiar with the risks, the technology and agreement with government.”
But as with countries around the world, South Africa also has to adapt to a cut in price for solar and wind energy, driven by intense competition and oversupply in global turbine markets and from mostly Chinese manufacturers in the PV industry.
It’ll be good news for consumers in the long run, but has cranked up the pressure for many players in the industry.
The drive towards renewable energy is stepping up competition. But while some countries are clearly more in tune with renewable energy than others, there’s only one that that can boast that it’s 100% green.
The South Pacific nation of Tokelau, which is the world’s smallest economy and home to only 1 400 people, is 100% renewable, since recently adopting a combination of solar PV and biofuel generated from coconuts.
By Kim Cloete. Source: Money Web