With the introduction of natural gas set to diversify South Africa’s energy mix, transform infrastructure and create jobs, the release of the draft Integrated Resource Plan (IRP) has sparked a dialogue around the potential impact on energy investors in 2019.
The industrial and economic benefits of natural gas for South Africa have been reinforced by The Department for Trade & Industry (DTI)’s Industrial Policy Action Plan, which highlights the development of the gas sector as a critical project. In 2016, natural gas contributed only 3.2% to South Africa’s energy mix. The draft IRP increases this number to 16%, with 8100MW new gas-to-power generation capacity by 2030. This estimated capacity is expected to be achieved between 2026 to 2029. Given that the majority of South Africa’s gas supplies are imported from its neighbours, the IRP has an impact beyond South Africa’s borders. Energy Minister Jeff Radebe made a special mention on importing gas from neighbouring Mozambique, fracking in the Karoo, and offshore import.
The IRP draft also touches upon the need for detailed analysis of international and local gas supply options to mitigate financial and technical risks for the new energy mix. In light of natural gas taking up a considerably larger role in the energy mix, the SADC and South Africa’s recognition of the potential value of a regional gas economy as well as the IPP Office’s Gas-to-Power Programme, the private sector can expect a year full of opportunities and interesting developments in Southern Africa’s gas market.
Taking place from 11-12 December, EnergyWeek South Africa will gather influential energy decision-makers from across Southern Africa to take part in the International Gas Cooperation Summit, the Southern Africa Renewable Energy Forum and the Black Industrialists Energy Summit. The International Gas Cooperation Summit will showcase South Africa as a gas hub, outlining the next steps of the Gas IPP Programme and the scale of opportunity for investors.