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Investments into registered renewable projects in South Africa have breached the R400bn mark, piling pressure on the government to speed up the rollout of the 14,000km of new transmission lines needed to connect the projects to the grid.Nersa on Wednesday said the projects it has registered since 2018 had reached an investment cost of R409bn — up nearly R120bn in the past year alone.The regulator in the first quarter of the 2025/26 financial year, which covers the period April to May, registered 124 projects with a total capacity of 804MW and an estimated investment value of R20bn, with solar photovoltaic (PV) projects attracting most investments.“The Western Cape, Gauteng and Limpopo recorded the highest numbers of new registered generation facilities. However, the Northern Cape, Mpumalanga and Gauteng led in total installed capacity and investment cost,” the regulator said.“The Northern Cape recorded the highest investment cost, at approximately R11.9bn, for projects with a combined installed capacity of 440MW.“Nersa’s approval of 124 new generation facilities supports grid reliability and safety, improves national electricity planning, encourages private investment, expands generation capacity, strengthens South Africa’s energy security and facilitates the transition to a more competitive, renewable-based electricity sector.”South Africa faces major hurdles in its green transition, led by severe transmission grid capacity limits, historical reliance on coal infrastructure, and complex multiparty contracting rules. Overcoming these bottlenecks requires building thousands of kilometres of new power lines and expanding battery storage.To this end, the government plans to build 14,000km of new transmission lines over the next decade at an estimated cost of R440bn.However, the “slow pace” of unbundling Eskom and stripping it of its transmission assets has frustrated big business, which has called into question the commitment of the utility’s board to implement the unbundling, first announced in 2019.The government last year published an ambitious R2.2-trillion integrated resource plan. The highlights include 11,270MW of solar photovoltaics by 2030, 7,340MW of wind energy, 6,000MW of gas-to-power, and 5,200MW of new nuclear capacity.The department of electricity & energy (DEE) aims to tap into land owned by the government and state-owned enterprises to speed up the rollout of renewable energy projects in reforms that include government-led land procurement for battery storage projects.The reforms are geared towards allowing investors to compete on price and technology rather than navigating complex land negotiations.To this end, the department has issued a request for information (RFI) to gather information on government-owned land parcels that could be earmarked for competitive procurement of new generation capacity from a combination of energy sources, including renewable energy projects.The department, led by Kgosientsho Ramokgopa, said it intends to use the information provided by government respondents to the RFI in response solely for the purpose of considering the potential feasibility of using government or state-owned land parcels in preparing procurement documentation for future independent power producer procurement programmes (IPPPPs).Read: State land could unlock faster renewable energy projects“The outcomes and information gathered pursuant to this RFI are intended to support the exploration of potential opportunities for alternative geographically targeted procurement approaches that could be used in the development of the IPPPPs and to gather information on site availability and readiness of any government/state-owned land parcels,” the RFI reads.“This RFI could help determine the feasibility of augmenting the traditionally used, purely developer/IPP-led site-selection model and whether sufficient opportunities exist to do so by designing an appropriate procurement framework that is more location-specific — a designated development corridor procurement model for the IPPP programmes.“The IPP office is conducting the studies pursuant to this RFI to explore the feasibility of more proactive procurer-led development models, especially where grid capacity in South Africa is currently constrained and project development timelines need to be shortened for accelerated delivery of the rollout of new generation capacity procured under the IPPP programmes.”Some of the challenges and issues independent power producers have faced include severe grid-access bottlenecks where optimal land often sits far from functioning transmission lines.A large chunk of South Africa’s land is in private hands, with only about 20% owned by the state. There are competing interests for state-owned land.One of the challenges of the transmission build is the government’s struggles to obtain the right of way from landowners whose land the transmission lines would criss-cross.Business Day
