First half of 2015 sees huge cost savings from renewable energy

August 21st, 2015, Published in Articles: Energize, Featured: Energize


A second independent study by the Council for Scientific and Industrial Research (CSIR) found that renewable energy from South Africa’s first wind and solar (photovoltaic) projects created R4-billion more financial benefits to the country than they cost during the first six months of 2015.

The full presentation may be downloaded here

The study is an update and continuation of an initial study, published in January this year, which covered the 2014 calendar year. The initial report can be downloaded here.

The benefits earned were two-fold:

The first benefit, derived from diesel and coal fuel cost savings, is pinned at R3,6-billion. This is because 2 TWh of wind and solar energy replaced the electricity that would have otherwise been generated from diesel and coal (1,5 TWh from diesel-fired open-cycle gas turbines and 0,5 TWh from coal power stations).

The second benefit is the saving of R4,6-billion to the economy derived from 203 hours of so-called “unserved energy” which were avoided thanks to the contribution of the wind and solar projects. During these hours the supply situation was so tight that some customers’ energy supply would have had to be curtailed (“unserved”) if it had not been for the renewable energy sources.

The avoidance of unserved energy cumulated into the effect that during 15 days from January to June 2015 load shedding was avoided entirely, delayed, or a higher stage of load shedding prevented thanks to the contribution of the wind and PV projects.

These direct cash savings on fuel spending to Eskom, and the macroeconomic benefits of having avoided unserved energy, are countered by the tariff payments to the independent power producers (IPPs) of the first wind and photovoltaic (PV) projects which amounted to R4,3-billion from January to June 2015.

Therefore, renewables contributed a total net benefit of R4-billion (or R2/kWh of renewable energy) to the South African economy. Wind projects were cash positive for Eskom to the tune of R300-million; saving R1,5-billion in fuel payments while costing only R1,2-billion in tariff payments to IPPs.

The full presentation may be downloaded here.

Contact Tendani Tsedu, CSIR, Tel 012 841-3417,



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