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Energize Drivers improving the business case for solar power
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Drivers improving the business case for solar power

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Information from IM Power  –  

Covid-19 has presented businesses with the opportunity to re-evaluate both their operational models and costs. Proactive organisations found themselves navigating a wake of reinvention by establishing variable cost structures as well as employing agile operations in terms of energy supply.

Confronted by plummeting sales and revenue along with rising inflationary costs, businesses have found themselves under immense financial pressure to rapidly recover from the pandemic at hand. To do so, business leaders have sought to reduce unnecessary expenses as far as possible by investing in cutting edge technologies to bring about improved energy savings.

Typical commercial rooftop solar PV installation.

As Covid-19 restrictions ease, businesses are clambering to recommence operations, resulting in an upswing in electricity demand. This has placed immense strain on Eskom’s ageing and poorly maintained infrastructure. In July, several concurrent breakdowns resulted in a resurgence of power supply interruptions, otherwise known as load shedding, in an attempt by Eskom to protect the national grid from collapsing. By the end of July, the amount of power reductions for the year had already exceeded the levels observed in 2019, which was the worst year of load shedding on record.

This unanticipated surge in load shedding has contributed to the nation’s thwarted post-Covid-19 economic recovery and unless real, measurable and deliberate action is implemented to support private electricity generation, incapacitating power cuts will continue for years to come, further derailing the domestic economy and stifling both local and foreign investment.

Eskom asserts that its improved maintenance programme, in pursuance of addressing decades of neglect and mismanagement, will cease load shedding within 18 months. However, it is unlikely that this goal will be met considering the scope of challenges Eskom faces at its inefficient coal-fired power stations.

The ideal solution is for the government to employ bold policy frameworks empowering municipalities, industries, businesses, farms and households to swiftly adopt new generation capacity with reliable, low-cost and environmentally friendly wind and solar PV installations coupled with battery storage initiatives. Extensive research from some of the world’s most respected energy experts has revealed that no other energy source, including hydro and wind, can provide power as sustainably, reliably, and efficiently as solar power.

According to industry experts, the future scope of solar energy for Africa is extensive and has seen exponential growth in the past few years. The continent has experienced a growth of over 1,8 GW of new solar installations, with 1,4 GW related to photovoltaic (PV) installations, which is a considerable increase from the 786 MW which was connected in 2017. In 2016, South Africa had 1,3 GW of installed solar power capacity and according to the government’s 2019 Integrated Resource Plan (IRP), this capacity is expected to reach 8,9 GW by 2030.

Solar has a major bearing on the African energy sector. The total power derived from solar has officially outpaced any other fuel with regards to global energy output. Solar is currently the frontrunner in renewables and solar PV additions are transcending all other fuels, including coal. A report conducted by the International Energy Agency (IEA) predicted unprecedented solar PV growth up to the year 2022.

Bulk electricity prices are set to increase by approximately 15% next year following a legal battle between Eskom and Nersa. Within the past seven years, South Africa has observed an almost 300% increase in electricity costs. In 2020 alone, between a 9% and 15% increase has been observed. Such increases are unsustainable and represent an additional substantial driver for why companies are seeking more efficient measures to provide a sustainable or stable cost of electricity. Another significant driver is the decline in the price of renewable energy alternatives, further incentivising the shift.

Contact IM Power, Tel 021 836-4292, info@im-power.co.za

 

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