Renewable energy utility solution

Eskom as you are aware purchases a significant amount of renewable “green” energy and also owns some generating plant that is considered green, such as the Sere windfarm. Eskom is investigating how to leverage this green energy and to pass these benefits through to customers through a renewable energy tariff. Making use of green energy is an excellent way to  promote green credentials and to:
  • Create unique selling propositions
  • Improve your competitiveness
  • Boost sales
  • Improve brand awareness and loyalty
 
South Africa has delivered great advances and innovations in the clean energy space, which greatly contributes to the country’s sustainable energy solutions and the meeting of environmental targets. SA has also seen a growth in distributed generation of clean energy via flexible, small- scale, grid-connected technologies producing electricity close to, or where it will be used.
As such, Eskom is developing renewable energy solutions to further sustainable development, expand our service offering, and to drive energy efficiency and productivity in South Africa.

The Renewable Tariff Pilot Programme

Eskom is creating a renewable energy utility solution to assist in delivering on customer’s renewable energy commitments without customers having to procure renewable energy through Power Purchase Agreements (PPAs) or installing own renewable plant at huge capital costs. The Renewable Energy Tariff pilot will allow customers to be able to source up to 100% of electricity from Eskom’s renewable sources that are considered “green”. Eskom is offering the opportunity to our customer’s to participate in the in this pilot.

Benefits

Clean energy alternatives.
Flexibility and convenience for national footprint or when moving facilities.
 
 
Investment into renewable energy costs, no capital outlay required. 

Simplistic short-term green power purchase.

 

24 hour non-variable renewable supply although not exempted from national loadshedding.

 

Improved environmental credentials.

 

How is the Renewable Energy Tariff Pilot designed?

The renewable energy pilot tariff will be a premium on the existing tariffs rates. The tariff is designed as a declining block tariff, where the more green energy a customer purchases (as a percentage of total consumption), the lower the rate. The structure of the tariff has ten pricing blocks (above the standard tariff charges), with each block representing the percentage usage of green energy by a customer. The blocks are in increments of 10%. For example, if a customer converts between 1% and 10% of their electricity consumption, it will cost an additional 25c/kWh, while between 90% and 100% will be an additional 5c/kWh on top of the standard tariff rate per kWh.

When is the pilot programme available?

Eskom’s renewable Energy Tariff pilot programme will last for a two-year period starting from 1 April 2021 to 31 March 2023. After the pilot is concluded, Eskom will consider the viability of introducing this as a standard tariff offer to customers.

How do you apply?

Any Eskom customer whose electricity account is up to date can subscribe for the Green energy tariff pilot. Simply contact your local energy advisor for additional information and assistance, or email our project manager by clicking the button below. Your energy advisor can also guide you in developing a renewable growth strategy, enabling you to take advantage of the benefits of renewable energy. Eskom will require an amendment agreement to be signed to participate in the pilot.

Frequently Asked Questions on Renewable energy

Eskom is creating a renewable energy, utility solution to help customers deliver on their renewable energy commitments. The Renewable Energy Tariff pilot programme will allow all our customers to source up to 100% of their electricity from Eskom’s renewable sources.  We understand that many businesses are faced with corporate renewable energy commitments.  The RET pilot programme gives customers a mechanism to achieve their corporate renewable energy commitments, without the initial capital investment in an owned generator and provides flexibility to relocate to different sites – and provides a supply of non-variable renewable energy over a 24-hour period.

The Renewable Energy Tariff to be charged for the contract period will be a c/kWh rate, payable in all time periods, and in addition to the current Eskom tariff charges.  It will be based on the percentage of renewable energy in kWh of the actual energy that the customer agrees to purchase over a period of 12 consecutive months (contracted capacity).

Customers can contact their relevant Key Customer Executives, or for additional information and assistance contact our project manager at koos.vanrooyen@eskom.co.za
The application process will involve the following:
  • The customer completes an RET application letter to indicate interest in the pilot. 
  • The letter should indicate the needed contracted percentage of renewable energy, contract capacity based on a forecast of the actual renewable energy to be consumed during the contract period, the applicable supplementary rate and the contract period. 
  • Eskom will then approve and reserve the contracted capacity for the selected contract period. 
  • The customer accepts the contractual conditions by signing a Supplementary Agreement to his/her current Electricity Supply Agreement. 
  • The contract will start on the selected start date and Eskom will then issue a monthly electricity account which includes an additional line item detailing the deemed Renewable Energy consumption and the associated Renewable Energy charge.

The forecast will be based on a historical total annual actual electricity usage (baseline) of at least one year including adjustments if production should change during the contract period for existing plants or load calculation if it’s a new plant. Eskom will be able to assist in data for the baseline for all Eskom Large Power Users.

The customer decides what percentage of the annual electricity consumption must become renewable energy.  So if he/she wants to convert between 1% and 10% the electricity consumed will cost 25c/kWh, between 30% and 40% will be 18c/kWh and between 90% and 100% will be 5c/kWh.  So the more renewable energy the customer wants to convert to renewable energy, the cheaper it becomes.  This will be charged separately from the normal electricity consumption, as a separate line on the electricity account.

The customer selects an affordable percentage of kWh which must be Renewable Energy. This percentage will be contracted as deemed Renewable Energy and charged monthly. Eskom will at the end of 12 consecutive months after the contract start date evaluate the actual percentage (the amount of Renewable Energy in kWh that was consumed by the customer over the 12 consecutive months) against the contracted percentage.  If the actual capacity is less than the contracted capacity (not as a result of any failure by Eskom to supply the full contracted capacity), Eskom will adjust the Renewable Energy Tariff based on the actual percentage and the Renewable Energy charge payable by the customer will be adjusted accordingly. The customer’s next electricity account will be adjusted to reflect the difference.

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Only if capacity is available and signing of a new contract will be required.  Therefore it is important to forecast the percentage of renewable energy as accurately as possible.

The duration of the forecast study will depend on the customer. The approval of the contracted capacity will be concluded within a week.

If customers only take part in the RET, the additional c/kWh rate payable in all time periods over and above the current Eskom tariff charges will be the only cost. For those who combine wheeling and the RET, they will pay additional administration and wheeling charges as per the standard wheeling and banking agreement.

The RET is a simplistic short-term renewable energy purchase with the minimum duration of one year and a maximum of two years. The tariff will kick off on1 April 2021 and will run until 31 March 2022, as it is a pilot project.

The contract can start on any date from the 1st of April during 2020 as long as the minimum period is 1 year. The contract will then be 1 year plus the remaining months until the 2 year pilot has stopped.

Eskom will issue a monthly electricity account which includes an additional line item detailing the deemed Renewable Energy consumption and the associated Renewable Energy charge. Eskom is also involved in the development of a Renewable Energy certification platform during the pilot, but this will not necessarily be used to certify the renewable energy purchased during the pilot.

Yes, the RET can supplement wheeled energy from a third party or own generation on site where a customer wants to achieve a 100% renewable energy target, however the pilot is only for a 2-year period.

Banking will not be allowed for any generator with a maximum export capacity (‘MEC’) or actual exported capacity of more than 1 MW, in which case the banking of exported energy will not apply, unless taking part in the RET Pilot and provided that the Renewable energy consumption exceeds 40% of the total active energy.

Eskom will honor the approval for banking for a generator with a maximum export capacity (‘MEC’) or actual exported capacity of more than 1 MW who takes part in the RET pilot for the 20-year duration of the power purchase agreement.