South African companies betting big on private power — including electricity from cow dung

South African businesses are investing billions into self-generating power capacity to combat the impact of load-shedding on their operations and reduce their carbon footprint.

In the last few months, news headlines have been filled with updates from various companies regarding ambitious plans to reduce their reliance on the grid and increase their consumption of renewables.

A big catalyst for these developments has been the amended private power generation licencing threshold in South Africa.

Initially, President Cyril Ramaphosa announced the government would increase the embedded generation threshold from 1MW to 100MW in June 2021.

However, he subsequently said the threshold would be removed altogether due to the private sector’s enthusiasm to produce their own power.

Energy experts and the business community widely welcomed and praised this move.

It came after Eskom CEO André de Ruyter said the 100MW limit was “arbitrary” and welcomed efforts by businesses to reduce their demand on the utility’s grid.

Eskom’s struggles to maintain its ageing and fault-ridden power plants have worsened in the past year.

Its regular load-shedding has cost the economy billions of rand, with retailers like Foschini Group losing thousands of trading hours in a few months.

The retailer has taken a drastic measure to address this, buying over 300 Tesla Powerwalls to provide backup power to its biggest stores.

Editorial credit: Roschetzky Photography / Shutterstock.com

But for many companies, being resistant to load-shedding is not enough — they want to get energy from sources other than Eskom.

Given South Africa’s copious amount of sunshine and the increasing affordability of the technology, solar power is proving to be the most popular option.

Solar can also often be fitted to existing rooftops, bringing down costs associated with buying additional land or building new infrastructure to support it.

One of South Africa’s largest grocery retailers — Shoprite — has installed enough solar PV panels at 62 sites to cover 20 soccer fields. These can provide a peak capacity output of roughly 26.6MW.

But the key industry that will make the biggest contribution is also one of the most energy-demanding sectors — mining.

According to the Minerals Council of South Africa, 24 mining companies have 5,100MW of new capacity in the pipeline across 73 projects in the coming years.

In 2022, 295MW of this capacity had been registered with the National Energy Regulator of South Africa (Nersa).

African Rainbow Minerals, Anglo American, Gold Fields, and Sibanye Stilwater are among the major mining groups with big self-generating plans.

Anglo American’s plans are particularly noteworthy.

It partnered with EDF Renewables to create the joint venture company Envusa Energy to realise its ambitious vision.

This company will develop an ecosystem of 3,000-5,000MW of solar and wind-powered capacity in South Africa, aimed for completion by 2030.

The first phase will see 600MW of renewable power generation being constructed from 2023.

Solar and wind are not the only options

One of the more unique approaches to self-generation is that of South African Breweries (SAB).

As part of its plan to switch all its demand to rely on renewable power by 2025, it is getting 4.7MW of electricity from Bio2Watt’s Cape Dairy Biogas plant.

The plant will use manure from 7,000 cows and waste from surrounding farms to create biogas that can generate electricity.

SAB has already been supplementing its factories with substantial solar power, which generated over 9.7GWh of power in the first eight months of 2021.

The table below summarises the amount of capacity and types of generation that major companies in South Africa have built or plan to build in the next few years.

This list is by no means exhaustive but focused on the biggest projects with sufficient information available on capacity.

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