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AEG Power Solutions subsidiary 3W Power has opened South Africa’s first utility scale solar inverter manufacturing facility

US government development finance institution the Overseas Private Investment Corporation (Opic) has announced it will beef up its South African operation from 2013, dedicating a senior staff member “to leverage the country’s position as a business hub and strategic US partner” and help implement the US-Africa Clean Energy Finance Initiative (US-ACEF)

The recent Moody’s downgrading of Eskom’s credit rating echoes the worsening external view on South Africa rather than reflecting specific worries about the power parastatal, writes Kevin Godier

A bilateral energy agreement signed by presidents Ian Khama and Jacob Zuma on 31 August has been greeted with a mixed reaction. The agreement is intended to lead to the export of coal from Botswana to South Africa.

The US Overseas Private Investment Corporation (OPIC) on 17 September announced a loan of up to $250m for the 60MW Boshoff solar PV facility. The project was selected as a preferred bidder in the second round of South Africa’s renewable energy independent power producer procurement programme (REIPPPP).

The South African cabinet has lifted a moratorium on shale gas exploration, following a report by a technical team convened by the Department of Mineral Resources (DMR). The government halted licensing applications in April 2011 to give time for an investigation into the potential environmental risks posed by hydraulic fracturing as well as the social and economic impacts of shale gas exploitation.

The Export-Import Bank of the United States signed a declaration of intent with South Africa’s state-owned Industrial Development Corporation (IDC) on 7 August to provide up to $2bn for South African energy projects sourcing equipment and services from the US, with an emphasis on clean energy.

PetroSA and Cairn India Group signed a farm-in agreement on 16 August for oil and gas exploration in offshore Block 1 in the Orange Basin, while Anadarko Petroleum Corporation has finalised a deal to operate Block 5/6 and Block 7.

The cabinet has approved a draft treaty between South Africa and the Democratic Republic of Congo for the development of the Grand Inga hydro project. The draft was drawn up by a technical committee of officials from the two countries following the signing of a memorandum of understanding by their presidents in November.

PetroSA has won approval for a project to secure gas feedstock for the Mossel Bay gas-to-liquids refinery. Project Ikhwezi is aimed at sustaining the life of the Mossel Bay refinery.

Standard Bank has registered a programme with the Clean Development Mechanism (CDM) executive board of the United Nations Framework Convention on Climate Change to supply low-pressure solar water heaters to low-income households in South Africa.

The deadline by which renewable IPPs must reach financial close is expected to be pushed back to end-August as the Department of Energy struggles to get the necessary approvals signed off, industry sources told African Energy.

Preferred bidder in the first round of the renewable energy independent power producer programme AE-AMD Renewable Energy told African Energy that solar panels for its solar projects will be supplied by Tenesol’s factory in Cape Town.

Major new solar equipment manufacturing facilities being developed by AEG Power and Gestamp Solar Steel signal that local content requirements are already beginning to bear fruit. But manufacturers need stronger commitments from the government if South Africa is to experience real growth in the sector, writes Dan Marks

For too long only a fraction of proposed projects have seen the light of day, but while it is too early to say the African power industry has turned a corner, signs of progress were reflected at EnergyNet’s Africa Energy Forum (AEF) in Berlin on 26-28 June. Veteran southern African project financier Clive Ferreira observed that the African power sector continues to underperform significantly. Projects take too long to reach financial close, procurement processes are not transparent, and low tariffs make investment unattractive. Few could disagree with Ferreira’s conclusion that it is “difficult to make private power work under these circumstances”.