Electricity from the proposed Waainek wind farm is expected to be sold at R1.25per kilowatt hour (kW-h) under the Renewable Energy Feed-In Tariff (Refit) scheme announced by the government.
Electricity from the proposed Waainek wind farm is expected to be sold at R1.25per kilowatt hour (kW-h) under the Renewable Energy Feed-In Tariff (Refit) scheme announced by the government.
This price will not affect the customer, who will still be charged 44 cents per kW-h. This price is subject to an annual increase of 25% which has been approved by the National Energy Regulator (Nersa). The electricity generated by the wind farm is expected to be sold to the Independent System Operator (ISO), an body currently being created by Nersa.
The ISO is designed to act as an intermediary between independent power producers and power distributors, such as Eskom or municipalities.
The organisation is set to be finalised by the end of the year. If electricity is sold directly to Eskom it will be sold at R1.25 per kW-h, under the first phase of Refit.
However, there are no guarantees that this specific project falls under the first phase. The electricity will then be sold to Grahamstown’s municipality at 44 cents per kW-h.
If the electricity is sold to private clients, it will be sold following a “willing seller willing buyer” scheme. While this price is significantly higher in the long-run electricity from the wind farm will be cheaper than that from Eskom, taking into consideration Eskom’s proposed price hike of 25% per annum.
Kevin Minkoff, project manager of Innowind, says that wind farms are allowed to sell power to private clients as long as they have all the relevant permits delivered by the authorities.
These include a positive record of decision from the Department of Environmental Affairs for an environmental impact assessment, a generator’s licence granted by Nersa, and a power purchase agreement in place with whoever will be the offtaker of the energy generated from the facility.
Power will not be sold to Eskom yet, as this sale falls under the Refit general bylaws which still need to be formally approved by government.
Until such time, there will be no wind farms feeding into the national grid and selling power to Eskom. While the government has decided on a renewable energy tariff for wind power of R1.25 per kW-h, this price will not affect the customer.
Whether the wind farm goes ahead or not, the price of electricity will remain the same. More information can be accessed on Nersa’s website, http://www.nersa.org.za/ at Nersa decision on Renewable Energy Feed-In Tariffs (Refit) Phase II .
