Upcountry visitors to Cape Town over the holiday season may have wondered why the city has less load-shedding than they’re used to.
If they arrived on the N2, they would have driven past the answer to their question: the Steenbras pumped storage hydroelectric system’s four turbines in the mountains above Gordon’s Bay can deliver up to 180MW of electricity to the city grid, enabling load-shedding to be reduced by one or two stages.
The 44-year-old city council power station is a taste of things to come — not just in Cape Town but throughout the Western Cape — if Alwie Lester can align his skills and experience with premier Alan Winde’s dream of a province that is not only energy resilient, but also independent of Eskom.
Lester started work this month as Winde’s energy adviser, with a brief to reduce the impact of load-shedding on the provincial economy and ultimately to free the Western Cape from Eskom’s well-worn on/off switch.
Given political support, funding, co-operation from municipalities and partnerships with the private sector, Lester says the long-term goal is no more than a decade away.
At that point, he says, the province should have an excess supply of self-generated electricity — at least half of which will be from renewable sources — and a billing system that allows customers to buy the cheapest electricity available at any time of day.
After 15 years as head of Eskom in the Western Cape and Eastern Cape, Lester is better placed than most to make such a confident prediction.
He left the utility at the end of 2021, and was approached last October by Anton Bredell, the Western Cape MEC for local government, environmental affairs & development planning. Bredell wanted his input on why Eskom was no longer able to adjust load-shedding schedules to accommodate farmers’ harvesting activities, as it had done under Lester’s leadership.
“In discussion with Eskom, it became apparent that they were now applying a lot more of the national approach to load-shedding, and were not so keen on helping agriculture,” says Lester.
The initial contact led to more talks and a job offer, and last week Lester took his seat as a key member of the new Western Cape Energy Council convened by Winde.
“I think it was just the extensive load-shedding, the economic impact it was having, the effect it was having on things like safety and security in the province, and the need to address this issue at a much more holistic level, as opposed to just trying to deal with day-to-day load-shedding issues,” says Lester.
His immediate priority is a plan to mitigate load-shedding this year. “Whether that comes in the form of diesel generators, photovoltaic with solar battery, or battery storage, we’ve got to look at what we can do almost immediately,” he says. “There’s obviously also demand-side management.”
Next, Lester will turn his attention to medium- and long-term projects to help the Western Cape’s 24 local municipalities generate their own electricity. The process is getting under way in Stellenbosch, George, Mossel Bay and Saldanha, and Cape Town is blazing the trail.
“We’ve drawn a line in the sand to say certain things need to happen in the next three years, and we’re looking at the City of Cape Town leading the bunch because they’re quite far ahead,” says Lester. “We expect the city to have some good movement by about 2024 or 2025 in terms of self-generation and I think the others will come on stream between 2024 up to about 2027.”
Cape Town mayor Geordin Hill-Lewis has set out a programme to make Cape Town immune from load-shedding by the start of 2027, and he’s ticking some early boxes: a city policy to buy surplus solar electricity from businesses and homeowners; a pilot wheeling project in which eight businesses are using the metropolitan distribution system to sell power they generate to third parties; and up to 300MW of generation capacity on its way after the first round of a bidding process for independent power producers (IPPs).
A tender is due this month for a “very significant” amount of power, including storage. The city is not restricting this to renewable energy and does not intend to impose a capacity cap. The key criterion will be that the electricity produced costs the same as or less than Eskom’s.
Hill-Lewis has also made a firm commitment to extensive network maintenance — another issue that Lester highlights. Two or three stages of load-shedding could be avoided if the national grid were able to handle generation capacity that exists but can’t be connected, he says.
“When we start talking about getting additional generation in place, we must also assist municipalities and the metro to start making sure that their own transmission and distribution networks are capacitated. That means we need to start planning investment in those,” says Lester.
Adding Eskom-free electricity to the system will allow municipalities to become more sophisticated in how they charge consumers, as long as the National Electricity Regulator of South Africa can move on from what Lester calls a “defunct” business model.
“If a municipality has one or two IPPs, consumers will have the option to use the cheapest energy at any time,” he says. “So at 2pm, if the Eskom energy is cheaper, you should have the option of buying that. But if, at the peak, your private IPP that sits in the municipal network is the most cost-effective, you should have the option of choosing that. You’ll have reliable energy and multiple sources of energy.”
If all this sounds like a utopian fantasy when load-shedding has become a quotidian curse, Lester is quick to acknowledge that everything he envisages will be expensive. But he believes market forces will prevail.
“The province has been approached by people from the private sector who are very keen to move into private-public participation where they would like to either fund or co-fund initiatives. And there’s definitely a willingness from IPPs to get involved.”
This is fuelled, he says, by their frustration with foot-dragging in the government’s renewable IPP programme. “IPPs work on fairly tight timelines in terms of equipment and resources, and they can’t afford these delays,” he says. “In the end, a lot of vendors and suppliers are going to start walking away because they can’t see that these things are going to come to fruition any time soon.
“So I definitely think that the Western Cape will get quite a bit of response from the industry when we start to open up [our self-generation projects].”
The new electricity won’t necessarily all be clean and green. “As much as we want to get away from fossil fuel, I don’t think that we are ready,” says Lester. “I would like to think we would have no more than 50% reliance on fossil fuels.”
Lester’s 10-year dream ends with Western Cape municipalities being able to generate between 5,000MW and 7,000MW of electricity, well over the 4,400MW the province currently draws from the Eskom grid.
That’s without counting the contribution from private projects such as a data centre’s 150kW photovoltaic installation, which he visited with Winde on the second day of his new job.
“Industry might actually get us across the line quicker than anything,” he says.