The National Energy Regulator of South Africa (Nersa) has released a consultation paper for phase-two of the renewable energy feed-in-tariff (Refit), requesting input from stakeholders and the public.
The paper discussed power purchase agreements (PPAs) which renewable energy investors had been awaiting in order to get started with projects as it had been excluded from the original Refit draft. Nersa has proposed that the PPAs, with Eskom’s Renewable Energy Purchasing Agency as the single-buyer of power generated from renewable energy projects, would be a 20-year contract.
Included under the Refits were technologies like concentrated solar power (CSP) plant without storage, solid biomass, biogas, solar photovoltaic (PV) systems, large ground or roof-mounted, concentrating PV, and concentration solar power central tower.
Considering the market conditions, reference technology cost, and performance assumptions, Nersa, in its consultation document, outlined the levelized cost of electricity for CSP without storage as R3,132/kWh. For PV greater than 1MW the levelized cost of electricity is R4,488/kWh; solid biomass is R1,181/kWh; biogas is R0,962/kWh, concentrating PV without storage is R5,481/kWh; and CSP tower with storage is R2,308/kWh.
Excluded technologies included wave, tidal, and geothermal technologies as Nersa said that they were not yet commercially viable – although investors are showing an interest in wave/tidal along the South African coastline. The regulator said that these technologies could be included in future revisions of the Refit.
Under the existing Refit, a wind tariff of R1,25/kWh was sanctioned, while small-scale hydro would receive 94c/kWh, landfill gas 90c/kWh, and concentrated solar R2,10/kWh.
Nersa said that all regulatory concepts and principles adopted in the first phase regulatory guidelines would remain unchanged and applicable to Refit phase two.
Written comments should be submitted to Nersa by August 20, which was also the closing date for interested parties to register to attend the public hearings into the Refit phase two.
The public hearings for Refit phase two were scheduled to take place in September, and the electricity sub-committee will make recommendations to the regulator in October.
Nersa approval of the Refit phase two is expected on October 29, 2009.