Wind energy construction activity in South Africa will peak at more than
1 GW of capacity in 2020/21 as developers race to operationalise projects that were awarded
during the fourth bid window of the Renewable Energy Independent Power Producers Procurement
Programme, says Wood Mackenzie (WoodMac) Power & Renewables.
Its ‘Africa wind power market outlook 2019’ report states
that, in the longer term, the country’s Integrated Resource Plan is expected to
target more than 10 GW of additional wind power capacity through 2030.
Further, President Cyril Ramaphosa’s proposed reforms for
the power sector is expected to create a more
favourable environment for renewable energy deployment.
“South Africa boasts Africa’s largest wind power market with 2.1 GW of
operational capacity as of the first quarter of 2019. Issues with governance
that took place in 2016 and 2017 were bad news for the local wind market, as no
new additions were recorded in 2018, says WoodMac senior analyst Sohaib Malik.
“However, installations are expected to restart in 2019 with 130 MW of
new capacity additions, though potential project delays jeopardise that
capacity and limit any upside potential for additional capacity.
“Growth prospects improve thereafter, with more than 1 GW of capacity
expected in 2020 and 2021 combined. This outlook is supported by ongoing construction activity, peaking in
2020 as IPPs race to achieve commercial operations.”
Meanwhile, cumulative wind power capacity in Africa stood at 5.5 GW by the
end of 2018. Africa’s wind project pipeline stands at 18
GW as of the first quarter of this year 2019, says Malik.
“The project realisation rate,
however, remains low in the region owing to a host of challenges faced by
developers. As some governments took measures to address these issues, the
regional market is expected to recover and grow exponentially between 2019 and
2021.
“Competitive procurement has proven to be the favoured tool of policy
support, with South Africa and Morocco having introduced
auction programmes in 2011 and 2015, respectively. Tunisia solicited bids for wind
independent power producers (IPPs) in 2017, while Kenya and Ethiopia are contemplating the launch
of auctions for future installations.
The National Renewable Energy Authority (NREA)
maintained market leadership in Egypt in 2018. This is expected to change
with the commissioning of the 262 MW Gulf of Suez project by an Engie-led consortium this
year.
“Similarly, the commissioning of 1 GW of wind capacity in Morocco, awarded between 2012 and
2016, will enhance [the role of] IPPs in this market. It is necessary for Egypt and Morocco to take measures to
consolidate their success.
As more governments introduce long-term plans to support wind power and heed investors’
concerns, private sector confidence in emerging markets will continue growing,
he points out.
“IPPs in Tunisia were lukewarm owing to
concerns regarding the power purchase agreement terms. The
government addressed these concerns by revising the contentious terms.
“On the back of making these amendments, the government received substantial interest for the 620 MW of capacity it will award before 2020. Similar favourable developments in countries including Ethiopia, Tunisia, Kenya, Algeria and Ghana offer a combined 6.2 GW wind market opportunity for developers and original-equipment manufacturers through 2028,” adds Malik. https://www.engineeringnews.co.za/article/south-africas-wind-power-construction-to-peak-at-above-1-gw-in-202021-woodmac-2019-06-05/rep_id:4136
