A Regulatory Approach to Foster Bulk Electricity Generation from Renewable Energies in South Africa

Regulations to promote the application of renewable energy in the electricity sector are crucial to achieve the government’s target of increasing the share of renewable energy to 10 TWh within 10 years. Feed-In tariffs provides the highest certainty to accomplish a significant growth of renewable energy since it provide high certainty to investors and are easy to implement. For the design of a Feed-In tariff for South Africa it is recommended that operators of the distribution grid (i.e. the regional electricity distributors) are obligated to purchase electricity from renewable energy sources at a fixed price. The price is set according to the generic generation costs. Remuneration levels differ according to different renewable energy technologies. Off-grid energy systems, solar water heating systems, and demand side management programmes should be considered to be promoted with regulation, too. Promotion of renewable energy can thus form an integral part of the National Electrification Fund