Solar, wind power are 40% cheaper than coal in South Africa - CSIR

Wind and solar power in South Africa comes with a price tag that is 40% cheaper than new coal-fired power stations, a study by the Council for Scientific and Industrial Research (CSIR) revealed on Friday.

The analysis by Dr Tobias Bischof-Niemz and Ruan Fourie at CSIR Energy Centre uses figures by the Independent Power Producer (IPP) Office, which oversees the procurement of new private generation capacity on behalf of the Department of Energy and the National Treasury.

Adjusting the bid prices to ensure a common base-date of April 2016, a consistent present-value-equivalent escalation index of CPI+1%-point, and exclusion of the carbon tax of ZAR 120 per tonne of CO2 from the coal IPP tariff, the study arrived at levelised cost of electricity (LCOE) of ZAR 0.62 per kWh for solar and wind against ZAR 1.03 for coal.

The solar PV, wind and coal IPP tariffs presented by the CSIR for South Africa are fully comparable, as they are all based on long-term contracts with the same off-taker (Eskom) as well as the same consumer price index inflation-linked escalation, Bischof-Niemz and Fourie stressed.

(ZAR 1 = USD 0.071/ EUR 0.064)

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