The current meltdown over at Eskom is pretty horrifying to watch: it seems like every day another generator goes offline, and now we hear that because the state-owned supplier has been burning through its diesel reserves in an attempt to keep the power on, it’s about to run out of cash soon too.
The immediate implications are, of course, a disaster. There’ll be bailouts – which the taxpayer will have to fund – with no immediate end to loadshedding in sight.
Long term, there’s an even bigger problem coming: something that’s been playing on my mind for a while. It already makes economic sense to go off-grid and invest in solar power at home. If you have the space to put a solar generator and battery back-up, you’ll have a cheaper and more reliable power supply than the grid can provide for the next 20 years.
What’s scary, however, is the up front cost of going off-grid – anywhere between R100 000 and R200 000 in our calculations. The fear I have is that pretty soon, thanks to loadshedding, the inequality gap between those who have access to power in South Africa and those who don’t will start to widen, rather than close as it has done over the last few years.
According to Stats SA, the number of households with access to grid electricity rose to just under 10m in 2013, up 2.3% on 2012. Could that number start declining soon?
Here’s the theory: as rich customers and businesses opt out of Eskom’s supply completely and build their own private power plans, the cost of energy for the rest of the country will go up, resulting in fewer revenues and less investment for the monopoly supplier.
Over at the South African Civil Information Service (SACSIS), WWF executive committee member Saliem Fakir has just published an excellent piece which goes into great detail on how such a crisis is occurring in front of our eyes. It’s a great, if depressing, read:
The fracturing of the electricity system into public and private domains is already happening due the crisis created by Eskom. It not only has far-reaching consequences for the economy, but also for the majority of South Africans who may end up with less affordable energy. Eskom too is likely to be stranded with assets that will continue to be a burden on South African taxpayers. Eskom, in any case, is already talking up the need for higher tariffs in future because any snowball effect also increases impending operating costs.
Being optimistic, however, I’d like to hope that the current crisis won’t just spur rich businesses and home owners into action. Just as we’ve seen with broadband, we should be encouraging housing complexes, blocks of flats, suburbs and – yes – even township communities to procure their own power services where they can.
One of the most interesting news stories for me last year was about a pilot project, when AngloPlats and Ballard funded an experiment in microgrid power for a community in Naledi Trust. There, a large hydrogen fuel cell has been installed to feed nearby houses with cheap electricity. If it turns out to be cost-effective, could we see widespread adoption of this kind of power production before we spend vast sums on nuclear?
“Those who need energy most will simply continue to be victims of an electricity system that is guided by crisis rather than long-term thinking,” writes Fakir, “The state’s failure is growing the divide in South Africa, not reducing it.”
Fakir is absolutely right: the fracturing of energy in haves and have nots along wealth lines would be a terrible outcome which would emphasise and increase those that already exist in this country – but it can be avoid if we can encourage and enable poor communities to behave more like rich ones and literally take power into their own hands. We need many, many more low cost, small scale energy producers working at the community level of the kind that saw Germany rapidly expand its renewable capacity and fast.
We need to decentralise energy production even beyond the current aims of the current renewable energy independent power producer procurement program. Only then can we avoid the nightmarish scenario Fakir predicts.