Viable Roof-top PV industry will boost job creation

Viable roof-top PV industry will boost job creation

By Jack Ward, MD of Powermode

There is no doubt that, in South Africa, the focus on renewable energy has sharpened significantly over the past couple of months. First, the Development Bank of Southern Africa (DBSA) approved loan facilities of R9.6 billion for renewable energy projects.

Then – after a three-month delay - the Department of Energy (DoE) obtained Government and Treasury approval to enter into long-term agreements with independent power producers (IPPs) for the supply of renewable energy into the Eskom grid.

The two moves are said to contribute to the establishment of a ‘renewable energy sector’, ultimately producing over 3 000 megawatts of electricity.

While the motives of both the DoE and the DBSA are good, I believe the exclusive funding of large, utility-type projects on a national scale misses an important opportunity – to create a broad-based ‘green’ industry that generates many tens of thousands of new jobs and boosts the economy at municipal or regional level.

While the DoE says it intends to stimulate the SA economy and provide jobs with its initiatives, the problem is that only a small number of ‘preferred bidders’ have been selected to pitch for once-off projects linked to the Renewable Independent Power Producers Programme, launched by the Energy Department in August 2011.

The massive infrastructure development projects associated with this programme will cost many billions of rand and include huge wind and solar farms, the latter employing either concentrated solar power or photovoltaic energy generation.

While they will undoubtedly assist the government to secure SA’s long-term energy future, the hundreds of jobs that will be created are project-based. Once the farms are up and running, only a small workforce will be needed for maintenance.

Would it not be a better bet to give financial support and incentives to the roof-top solar panel market? If the DoE and the DBSA were to support solar power initiatives targeting small to medium sized businesses and the domestic market, a viable green industry would be created employing many thousands of workers over a much longer period than the large capital projects ever could.

The key to the creation of this industry is incentives for users. While Eskom has a successful solar geyser incentive programme in place there is much confusion surrounding its photovoltaic (PV) schemes. Unfortunately, the rules are so complex, and the technical demands so elaborate that the average small business and domestic users are all-but ruled out of the process.

Perhaps the DoE and the DBSA should take a look at developments in Europe centred on the concept of feed-in-tariffs (FITs) targeted at homeowners, small business owners, farmers, as well as private investors who are paid a cost-based price for the renewable electricity they produce and feed back into the national electricity grid.

This has enabled a diversity of technologies (wind, solar, biogas and other sources) to be developed, providing both small and large scale investors with a reasonable return on their investments.

In SA, the rooftop PV market has the potential to create an entire industry populated by suppliers, local manufacturers and skilled artisans. It holds the promise of sustainable employment with the proliferation of small businesses to service its needs.

This will accelerate economic growth throughout SA including the degenerating rural areas where even a humble shack dweller could – with the appropriate backing and incentives - become a power generator and an entrepreneur serving his or her community.