Energy challenges require innovative financing and development solutions

An over-reliance on old, badly maintained and coal-based power plants has created an unpredictable, environmentally-unfriendly and costly energy market. However, alternative solutions are already proving successful in the renewable energy space, where many projects are now contributing hundreds of megawatts to the national grid. Apart from this, the country is geographically well positioned for a number of new and innovative energy-generating technologies.

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There’s also a significant need in Africa for energy and infrastructure in general, and the opportunity exists for the energy to be in a renewable format.

Nandu Bhula, CEO of ACWA Power Solafrica’s Bokpoort CSP, introduces concentrated solar power (CSP) as a potential answer – or part of an answer – to South Africa’s present power woes.

Though traditionally considered an unreliable form of energy production, ACWA Power’s CSP plant in Bokpoort, Northern Cape has a thermal energy capacity of 1,300MWh – that’s equivalent to nine-and-a-half hours of electricity. It is also “greener” and more economical than the current favoured method of energy production.

Appropriate fund mechanisms

South Africa is well suited to technology that can generate energy in cleaner ways, photovoltaics in particular. However, question marks remain around the most appropriate funding mechanisms to support these projects.

Chairman of the Institute of Directors of SA, John Oliphant, says there was an urgent need for government to invest in infrastructure to aid the development of the renewable energy sector, yet it currently cannot afford to do so. The answer, he says, was private-sector infrastructure development. Pension funds, for example, are suitable long-term holders of infrastructure assets and appropriate products can be developed to suit their risk appetite.

Head of natural resources at Standard Bank, Berrie de Jager, says he was excited about the future growth potential in the alternative energy market and the solutions these can bring to resolve persisting energy challenges. “There is plenty of opportunity to finance and develop solutions that can boost the economy and create a better life for all."