Eskom introduces rebate for small scale Renewable Energy

Submitted by: Margaret McKenzie, Friday, March 30, 2012

Eskom is introducing a rebate for small scale Renewable Energy projects, Cedric Worthmann of Eskom told members of the KwaZulu-Natal Sustainable Energy Forum at a meeting on 28th March 2012. “Two weeks ago we were given the go ahead to pilot 20 MW of micro wind, micro hydro and micro pv” said Worthmann, a business development manager at Eskom.

Worthmann emphasised that the rebate was limited to “self-consumption” projects and that the energy generated would need to be used on site.   The rebate is for projects starting from 10 kW up to a maximum of 1 MW.   While the current design of the rebate is still being finalised Worthmann said that it was expected to pay between R1.05 and R1.20 per kWh of energy generated over a three year period.   Payments would only be made for energy that reduced the total electricity imported from the grid.

Worthmann estimated that the rebate could contribute to between 30% and 40% of the total capital costs of a renewable energy project depending on project design.  He also indicated that Eskom is keen to fund other renewable energy applications besides wind, hydro and solar.

The rebate has been designed to provide a subsidy for below 1 MW projects as there is currently no other incentives for this scale of project.    Some of the key qualifications for participation that have been identified by Eskom are:

  1. Only equipment installed on the host customer’s side of the meter would be eligible and only energy production that is less than or equal to annual consumption.
  2. Systems must be new and in compliance with all applicable performance and safety standards.
  3. Grid tied systems must comply with all Regulatory and embedded generation interconnection requirements.
  4. Stand-alone systems (i.e. applications that are not grid tied) must replace an existing or planned grid connection/supply therefore substituting energy that would have been drawn from the grid.

The rebate will be offered through the existing Standard Offer, Standard Project and Performance Contracting Programmes of Eskom as part of the Integrated Demand Side Management Programme.   More information on the rebate is available from Cedric Worthmann on Cedric.Worthmann@eskom.co.za

Margaret McKenzie