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The World Bank says agricultural prices are expected to fall 2.6 per cent this year on average, amid ample stocks but foresees a 1.7 per cent rise in 2020 on expected cuts in U.S. crop plantings and higher costs of energy and fertilizers. For a focus on the global commodities market, Damilola Akinbami, Head of Research at Financial Derivatives joins CNBC Africa for more.

How the US-China trade war is disrupting commodity markets

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Oil prices are down in early trade, as rising U.S crude inventories and weak economic data from China erased some of the sharp gains from Tuesday&#8217;s 4.7 per cent surge. To review the global oil markets and the impact on Nigeria&#8217;s oil and gas space, Rolake Akinkugbe-Filani, Senior Vice President and Head of Energy and Natural Resources at FBNQuest Merchant Bank joins CNBC Africa for more.

Oil prices continue to decline as U.S-China trade war deepens

HARARE (Reuters) &#8211; Zimbabwe will ramp up its electricity imports over the next few weeks, potentially easing rolling power cuts, after it agreed to make payments to clear its debt to a regional power utility, a treasury official said on Monday. 



The southern African nation has endured 18-hour daily power cuts since May as a result of a prolonged drought that has reduced output at its largest hydro plant and ageing coal-fired generators that keep breaking down.



Foreign power companies also stopped supplying Zimbabwe with electricity in 2017 after the country failed to pay its bills, although Zimbabwe resumed limited imports of 300 MW a month last week.



George Guvamatanga, secretary for the ministry of finance, told business leaders in Harare that Zimbabwe had agreed to make weekly payments to clear its debt to a regional power utility, which would start providing at least 400 MW of electricity a month, starting from this week.



That would take total imports to 700 MW a month.



Guvamatanga did not name the supplier. Zimbabwe typically buys electricity from South Africa’s Eskom and Hydro Cahora Bassa of Mozambique.



Zimbabwe owes more than $70 million to Eskom and Hydro Cahora Bassa of Mozambique for past power supplies.



“I think the arrangement that we have put in place now on electricity should hopefully guarantee us increased supply from tomorrow or Wednesday,” Guvamatanga said.



“Working with the mining sector we have been able to ring-fence adequate resources to pay for at least 400 megawatts of electricity a month.”



Power shortages, along with drought and a severe dollar crunch, will result in the economy shrinking this year, the finance minister said last week.



Energy and Power Development Minister Fortune Chasi was in South Africa at the end of July to try negotiate for a power deal with Eskom. He did not immediately respond to calls and messages on his mobile phone on Monday.



Eskom, which is itself struggling to meet South Africa’s electricity needs, had no immediate comment.



The government said last week that power utility ZESA Holdings was accessing 300 MW during off-peak hours from the Southern African Power Pool, a regional industry collaboration linking up national grids.



Guvamatanga said for now Zimbabwe would have to rely on electricity imports, which required foreign currency that is in short supply.



Last week finance minister Mthuli Ncube announced a three-fold increase in electricity tariffs, as the government seeks to raise more funds for power generation.



Reporting by MacDonald Dzirutwe; Editing by Susan Fenton

Zimbabwe ramps up its electricity imports to ease outages

ABUJA (Reuters) &#8211; Nigeria and German company Siemens have agreed a roadmap to increase Nigeria’s “reliable” power supply to 11,000 megawatts by 2023, President Muhammadu Buhari said on Monday.



The president of the West African country said that at present, “only an average of 4,000 megawatts reliably reaches consumers”. He said Nigeria would work with Siemens to achieve “7,000 megawatts of reliable power supply by 2021 and 11,000 megawatts by 2023”.



Reporting by Felix Onuah; writing by Alexis Akwagyiram; editing by Jason Neely

What you need to  know about Nigeria’s roadmap agreement with Siemens to increase power

By <a href="https://www.cnbc.com/anmar-frangoul-profile--cnbc/">Anmar Frangoul</a> 



Africa’s largest wind farm, the Lake Turkana Wind Power project, has been officially inaugurated.



The 310-megawatt (MW) facility was opened by President Uhuru Kenyatta of Kenya on Friday.



“We are pleased to note that Kenya is without doubt on course to be a global leader in renewable energy,” he said in a speech given at the launch.



“This will not only ensure that our nation’s scenic beauty and unique ecosystems are preserved and protected for both present and future generations, but will also ensure that we become energy independent and that our energy supply will be safe as well as predictable,” he added.&nbsp; The Lake Turkana Wind Power project is made up of 365 turbines, each having a capacity of 850 kilowatts. It is located 600 kilometers from Nairobi in the Loiyangalani District, Marsabit County. Construction of the facility started in October 2014 and it began full commercial operations in March 2019.&nbsp; The International Renewable Energy Agency has described Africa as being “rich in renewable energy sources” such as hydro, wind and the sun.&nbsp; The Lake Turkana project is one of several large-scale renewable energy schemes to be developed on the continent in recent years.&nbsp; In December 2018, it was announced that ground had been broken on West Africa’s “first utility-scale wind power project,” located in Senegal.



The 158.7 MW Parc Eolien Taiba N’Diaye, or PETN, is set to be completed in 2020, according to renewable energy firm Lekela.



The 46-turbine facility will use turbines from Danish company Vestas and will generate more than 450,000 megawatt hours of energy annually, boosting Senegal’s generation capacity by approximately 15 percent, Lakela said.



This article first appeared on CNBC <a href="https://www.cnbc.com/2019/07/22/the-biggest-wind-farm-in-africa-is-officially-up-and-running.html">https://www.cnbc.com/2019/07/22/the-biggest-wind-farm-in-africa-is-officially-up-and-running.html</a> and is republished with its permission.

The biggest wind farm in Africa is officially up and running in this East African nation

JOHANNESBURG (Reuters) &#8211; The group treasurer of South Africa’s Eskom, Andre Pillay, will leave the power utility at the end of August, it said on Monday, the latest high-profile exit after its chief executive quit earlier this year.



Eskom supplies more than 90% of South Africa’s electricity, but has implemented severe power cuts this year and is failing to generate sufficient profit.



It is hinging its recovery hopes on a 230 billion rand ($16 billion) bailout pledged by government in February.



Reporting by Mfuneko Toyana; Editing by Jan Harvey

Treasurer of South Africa’s Eskom quits, what you need to know

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 Aerial view of Kariba dam.
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<a href="https://theconversation.com/profiles/tafadzwa-makonese-750988">Tafadzwa Makonese</a>, <a href="http://theconversation.com/institutions/university-of-johannesburg-1275">University of Johannesburg</a>

Zimbabwe’s government has announced its facing critical power shortfalls. The country’s anchor power producer, Kariba Dam, might <a href="https://www.fin24.com/Economy/Africa/zimbabwe-to-approach-eskom-for-help-as-kariba-dam-levels-drop-20190603">have to stop</a> production in weeks due to dropping water levels. Tafadzwa Makonese spoke to Moina Spooner from The Conversation Africa about what can be done.

What are the main challenges facing Zimbabwe’s energy system?

Zimbabwe has a severe energy crisis because its major sources of electricity are struggling to keep up with demand. 

Kariba power plant dam – where Zimbabwe gets <a href="https://www.researchgate.net/publication/304021888_Renewable_energy_in_Zimbabwe">57% of its electricity</a> – has low water levels due to poor rains last year. At the moment the dam, which sits on the border of Zimbabwe and Zambia, is producing <a href="https://www.thesouthafrican.com/news/zimbabwe-darkness-eight-to-ten-hour-load-shedding/">just 34%</a> of what it usually can. If Kariba stopped producing Zimbabwe would <a href="https://www.fin24.com/Economy/World/power-production-on-the-verge-of-shutdown-at-zims-kariba-dam-20190531">lose about 358 MW daily</a>, that’s about 300 000 homes without power. 

On top of this, Hwange colliery – which provides <a href="https://www.bloomberg.com/news/articles/2018-07-02/hwange-of-zimbabwe-coal-output-to-surge-on-underground-mining">almost all</a> of Zimbabwe’s coal for power generation – is producing less <a href="https://www.fin24.com/Economy/World/power-production-on-the-verge-of-shutdown-at-zims-kariba-dam-20190531">because of</a> old and deteriorating infrastructure. 

Currently Zimbabwe <a href="https://af.reuters.com/article/africaTech/idAFL8N237276">produces</a> 1100 MW of power against a national demand of 1500 MW. This leaves a supply gap of 400 MW. The deficit is catered for <a href="https://www.fin24.com/Economy/zim-looks-to-sas-eskom-to-help-stave-off-load-shedding-20190512">by imports</a> from Mozambique and South Africa. 

But payments for these imports aren’t easy to keep up with. For the past 10 years Zimbabwe has been going through a <a href="https://world-news-monitor.com/money/finance/2019/05/31/zimbabwe-strikes-imf-deal-to-boost-new-currency/">currency crisis</a> caused by hyperinflation. This has severely eroded the power of local currency, leaving the Zimbabwe Electricity Supply Authority in a financial quagmire. They <a href="https://www.fin24.com/Economy/Africa/zimbabwe-to-approach-eskom-for-help-as-kariba-dam-levels-drop-20190603">currently owe</a> Eskom, South Africa’s power utility, over $33million.

Because of these challenges, any drop in national production means the government has to ration electricity. The government recently started a load shedding plan <a href="https://www.thesouthafrican.com/news/zimbabwe-darkness-eight-to-ten-hour-load-shedding/">to prevent</a> the collapse of the country’s power grid.

What are the short to medium term solutions?

One short-term solution could be small solar power systems that are rolled out while the government works to improve national power generation through additional hydropower plants, solar and wind farms. 

Small solar systems are an effective source of electricity in off-grid communities or they could be set up as mini-grids in communities that constantly suffer from power-cuts. Zimbabwe <a href="https://www.sciencedirect.com/science/article/pii/S0973082614000787">has enough</a> solar power to support these.

These solar systems could be made cheaper through the introduction of subsidies and tax incentives. Even better, the government could waive taxes on all certified systems coming into the country. 

And more needs to be done to publicise the use of gas in urban and rural households. Gas is underused in Zimbabwe, partly because it is more expensive compared to other energy sources including kerosene. The government could look for investments through private partnerships to build gas mines. Zimbabwe <a href="https://www.herald.co.zw/zim-to-set-up-own-gas-mines/">has over 40 trillion</a> cubic feet of potentially recoverable methane gas in the Lupane-Lubimbi area. Considering the cost of building infrastructure to transport the gas from the production sites, it would be significantly cheaper to exploit these than to import from Mozambique. 

Industries that need to cope with power cuts should turn to energy storage. In Johannesburg, South Africa, some industries <a href="https://www.engineeringnews.co.za/article/energy-storage-a-viable-solution-to-load-shedding-2019-04-05">have integrated</a> energy storage into their micro-grids – the solar energy <a href="https://www.altenergymag.com/article/2019/02/energy-storage-microgrids/30388/">is stored</a> in batteries that are used when the grid fails. 

Are there experiences from other countries, in fixing a dilapidated electricity system, that Zimbabwe can draw lessons from?

Nepal and Bangladesh are good examples. 

In 2014 Nepal was experiencing up to 12 hours of power cuts for the residential and industrial sector. This was <a href="https://kathmandupost.ekantipur.com/news/2018-05-14/entire-country-is-now-free-of-loadshedding.html">finally stopped</a> in 2017. Nepal invested heavily in run-of-the-river micro-hydropower plants. These are hydroelectric systems that harvest the energy from flowing water to generate electricity in the absence of a large dam and reservoir – as opposed to conventional hydroelectric power plants which rely on the power of water falling a large distance. 

It all paid off when water levels in major rivers rose and power could be generated. By 2018 the country <a href="https://www.intechopen.com/books/renewable-hydropower-technologies/hydropower-development-in-nepal-climate-change-impacts-and-implications">produced</a> 1000 MW from 782 MW in 2016.

Zimbabwe relied heavily on the Kariba Dam power station, without establishing more hydropower plants elsewhere. It <a href="https://www.sciencedirect.com/science/article/pii/S1876610217354486">has huge</a> small-hydro potential. 

Bangladesh meanwhile shows how energy-saving behaviour – like turning off lights in unused rooms, use of solar water geysers, and use of energy efficient home appliances – under its national energy efficiency and conservation master plan <a href="https://link.springer.com/article/10.1007/s40095-019-0302-3">reduced demand</a> by up to 51%.<img loading="lazy" decoding="async" src="https://counter.theconversation.com/content/118209/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important" />

<a href="https://theconversation.com/profiles/tafadzwa-makonese-750988">Tafadzwa Makonese</a>, Senior Research Fellow, Sustainable Energy Technology and Research Centre, <a href="http://theconversation.com/institutions/university-of-johannesburg-1275">University of Johannesburg</a>

This article is republished from <a href="http://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/quick-fix-solutions-to-zimbabwes-huge-electricity-crisis-118209">original article</a>.

What are the short-term solutions to Zimbabwe’s huge electricity crisis ?

LONDON (Reuters) &#8211; U.S. energy firm Anadarko Petroleum Corp on Tuesday gave the go-ahead for the construction of a $20 billion gas liquefaction and export terminal in Mozambique, the largest single LNG project approved in Africa. 



The announcement, which occurred at an event in Mozambique, was widely expected after Anadarko last month flagged the decision date.



&#8220;As the world increasingly seeks cleaner forms of energy, the Anadarko-led Area 1 Mozambique LNG project is ideally located to meet growing demand, particularly in expanding Asian and European markets,&#8221; Chief Executive Officer Al Walker said in a statement&nbsp;<a href="http://pdf.reuters.com/htmlnews/htmlnews.asp?i=43059c3bf0e37541&amp;u=urn:newsml:reuters.com:20190618:nPn4scVtza.">here</a>



Anadarko has agreed to be taken over by Occidental Petroleum Corp. Once that deal goes ahead, Occidental has agreed to sell assets including the Mozambique LNG project to French oil major and large LNG trader Total SA. Officials at Total were not immediately available for comment.



Natural gas use is growing rapidly around the world as countries seek to meet rising energy demand and wean their industrial and power sectors off dirtier coal.



The project, which has committed long-term supplies to utilities, major LNG portfolio holders and state companies around the world, underscores the industry’s conviction that LNG demand will soar in years to come despite a slump in prices this year.



Low prices for the gas that is super-cooled for transportation prompted fears final investment decisions (FIDs) such as Anadarko’s would be delayed or scrapped. But the U.S. company gathered enough long-term buyers to underpin the financing of the project.



“Flexible commercial arrangements, including an innovative co-purchase agreement with Tokyo Gas and Centrica, have been instrumental in securing the project a roster of high-quality customers in a crowded LNG market,” said Frank Harris, head of LNG Consulting at Wood Mackenzie.



LNG prices slumped this year as a jump in supply from new terminals in the United States, Australia and Russia were not totally met by higher demand in Asia.



The trade is also nowhere near as developed as the market for crude oil, causing erratic price movements.



“At $20 billion, today’s FID is the largest sanction ever in sub-Saharan Africa oil and gas,” added Jon Lawrence, an analyst with Wood Mackenzie’s sub-Saharan Africa upstream team.



The project is also expected to be transformational for Mozambique, one of the poorest nations on earth beset by economic crisis, conflict stemming from a civil war and serious governance malaise, whose annual gross domestic product is just $13 billion.



The government of Mozambique said the project is expected to create more than 5,000 direct jobs and 45,000 indirect jobs.



With a 12.88 million tonne per year (mtpa) capacity, Mozambique LNG is one of the largest greenfield LNG facilities to have ever been approved. It involves building infrastructure to extract gas from a field offshore northern Mozambique, pump it onshore and liquefy it, ready for further export by LNG tankers.



On the African east coast, the liquefaction plant will be able to sell LNG to both the lucrative Asian market, home to 75%of global LNG demand, and to the flexible European market, which helps balance global LNG trade by soaking up excess supply.



Mozambique LNG joins other mega-projects approved in the past year such as Exxon Mobil Corp’s 16 mtpa U.S. Golden Pass plant and Royal Dutch Shell Plc’s 14 mtpa LNG Canada facility.



Still expected this year are approvals from Exxon for a 15.2 mtpa project also in Mozambique, and from Russia’s Novatek for its 19.8 mtpa Arctic LNG-2 plant.



Anadarko’s partners in the Mozambique LNG project are Mitsui, Mozambique state energy company ENH, Thailand’s PTT and Indian energy firms ONGC, Bharat Petroleum Resources and Oil India.



Reporting by Sabina Zawadzki in London; additional reporting by Scott DiSavino in New York and Debroop Roy in Bengaluru; Editing by Jan Harvey, Marguerita Choy and Arun Koyyur

U.S. energy firm Anadarko approves $20 bln LNG export project in this African country

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Kumba Iron Ore has pledged to support black women and youth owned small businesses within the mining community by giving them the opportunity to supply the products and services to the value chain.

Kumba commits R2bn to small business development

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CNBC Africa is joined by Penny Herbst, Director Strategy for Africa GreenCo. She believes that the electricity supply industry needs a fresh approach.

Should Africa rethink its electricity supply approach?

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Conversations around, energy, agriculture, and human settlement will take centre stage at this year’s African Climate week which kicks off today in Accra, Ghana. Yusuf Suleiman, CEO of Blue Camel Energy joins CNBC Africa to discuss how Africa can take advantage of its renewable energy potentials.

How Africa can take advantage of its renewable energy potential

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Nigeria’s construction industry has been improving on the back of a rebound in oil markets says GlobalData. The analytics company notes that the industry’s performance has also been bolstered by the government’s focus on developing the infrastructure, energy and residential sectors. Yasmine Ghozzi, Economist at GlobalData joins CNBC Africa to discuss the outlook for Nigeria’s construction industry.

Nigeria’s construction industry improves on back of a rebound in oil markets

By Chris Bishop.
Business and households were given a pre-Christmas shock with a frank disclosure of the ruin of Africa’s biggest power generator amid claims of sabotage, corruption and decay where those who try to fix it are swept aside or forced out of their jobs. The only crumb of comfort is that the government promises to shake up South Africa’s power generator Eskom and has cancelled their Christmas holidays for its senior executives so they can tour the ageing power stations of the country to find out what is wrong.
“We have reshuffles in cabinet we are going to be reshuffles here as well,” says Pravin Gordhan, the public enterprises minister.
Gordhan and Eskom chairman Jabu Mabuza were called back from a road show for an emergency press conference at Eskom’s Megawatt Park in Sandton, Johannesburg. They painted a bleak picture of the failing national grid, supplied by Eskom, that has left many businesses and homes in the dark over the last few months. The grid of 47,000 MW is running on a mere 29,000 MW because of maintenance and breakdowns in the ageing power stations on the country, most of which were built in the 1970s. Eskom didn’t even know where the next break will be, he said.
“For business, we want to ensure by the time you get back to work in January we have a better situation,” says Gordhan.
But Gordhan acknowledged it was likely to be a grim fight against years of corruption and decay that has seen the pride of Africa’s power generation reduced to a load shedding shell.
“There has been declining production, the growing need for repairs, the lack of attention, we are not sure yet whether there is an undermining of the system, as well, let’s call it sabotage,” he says.
“Some of the problems can be ascribed to the age of the plant, but from about 2010 the investment in maintaining, repairing and big scale repairs were not done adequately. Enough money was not put into big repairs and mid-term repairs.” 
“ Often things were fixed with a very lousy old band aid supposed to last a week that comes unstuck in a few days, then you haven’t fixed it .We are looking at contactors not doing what they were supposed to do.”
Experts in Eskom who tried to fix the mess were either swept aside or forced to leave, Gordhan said.
The minister even admitted that his department was also a step behind what was going on at Eskom. It had merely on energy expert.
“The public was told we have a world class operation, but in the meantime all the malfeasance and mismanagment has gone on,” says Gordhan.
Eskom hopes to report back within ten days and plans to set up a team of experts to assess the damage to the power generation system.

Lights out, game on- No Christmas of rest and turkey for the bosses in a dingy tale of decay

By: Amadou Hott, Vice-President of Power, Energy, Climate Change &amp; Green Growth at the African Development Bank
Accessible, reliable and affordable energy is the cornerstone of transformational socio-economic development. For Africa, delivering sustainable development is dependent on meeting the continent’s energy needs in order to lift populations out of poverty, catalyze industrialization, and stimulate economic growth.
Despite the continent’s abundant energy resources, energy poverty is still rife in the continent with close to 600 million people lacking access to electricity. This sets nations back on meeting energy access goals, retards industry progress, and diminishes the continent’s economic growth by 2 to 4 percent every year.
On a positive note, energy access has improved in recent years with the number of people without access in sub-Saharan Africa falling for the first time in absolute terms, and with countries such as Ethiopia, Kenya and Rwanda leading the pace. Africa is at the forefront of distributed energy systems that can increase energy access in rural areas faster, more cheaply, and more widely than conventional grid extension, driven by innovative business models and rapidly decreasing technology costs. At the same time, renewables are on the rise across the continent with significant renewable generation capacities added in countries such as Egypt, Morocco and South Africa.
Renewable energy investments are also on the rise across the continent from Senegal, to Kenya, and Zambia. While this progress is encouraging, the pace of energy access falls far short of meeting the universal energy access target by 2030.
Closing the gap on Africa’s energy challenges presents major opportunities for investors keen on engaging with the continent, especially on helping Africa meet the shortfall in the estimated $90 billion required to achieve universal energy access by 2030.
Clearly, these financing needs are of such magnitude that no single institution is capable of meeting them in isolation. This is why development finance institutions need a pragmatic shift in how they do business and leverage scarce public resources in order to mobilize private sector financing at scale, “from billions to trillions”.
The African Development Bank is leading by example. For instance, the Bank launched the Facility for Energy Inclusion to close funding gaps in the small-scale energy infrastructure sector, and catalyze last-mile energy access. Through a mix of commercial and concessional instruments, the facility provides low cost of capital, and mitigates key credit and currency risks. Additionally, the recently approved the Room2Run transaction allows the Bank to effectively transfer the credit risks of selected loan portfolios to investors, which lowers the total risk consumption of the Bank.
This initiative will enable the Bank to recycle capital efficiently in order to boost lending capacity and enhance private sector investments. The transaction has already attracted major support from partners like the European Commission who will provide a $100 million guarantee to be channeled into renewable energy projects in Africa. Ultimately, this will free up around $700 million, which can be re-allocated to new projects.
Multiple barriers hinder investments and private sector participation which could potentially fast-track energy access. These include lack of an enabling policy environment for investors, and other systemic bottlenecks that slow down transactions and escalate project costs. Transforming the energy landscape calls for a multi-faceted approach to unlock private sector capital by resolving these barriers in order to create the ideal conditions for investments in the continent.
The African Development Bank in close collaboration with other development partners is perched on the apex of creating a vibrant marketplace that will deliver the energy transformation necessary to move Africa forward. The Bank is dedicated to eliminating and minimizing barriers for investors, primarily through financial instruments to de-risk transactions, disseminating knowledge and market data, and facilitating peer-to peer learning and networking. Private sector engagement is on the rise, buoyed by various partnerships such as the New Deal on Energy for Africa and the US-led Power Africa Initiative.
To sustain this momentum, the bank convened the inaugural Africa Energy Market Place (AEMP) in Abidjan in July 2018. The AEMP is a platform for public private dialogue, and is set up to address barriers to mobilizing and scaling-up private investment into the energy sector. Effectively, AEMP reviews and prioritizes transformative energy transactions, and accelerates reforms in order to attract private investments and create a pipeline of bankable projects. Five countries participated in the inaugural edition: Côte d&#8217;Ivoire, Egypt, Ethiopia, Nigeria, and Zambia.
The conversations that began at the AEMP are set to continue in November’s Africa Investment Forum (AIF) in South Africa. The forum convenes project sponsors, borrowers, lenders and investors with a shared interest in closing Africa’s infrastructure gap which is estimated to be anywhere between $130–$170 billion per year.
By convening,and facilitating mutually beneficial dialogue amongst stakeholders who can dramatically impact Africa’s energy landscape, the Bank is creating the requisite foundation for accelerated private sector investments in Africa’s energy sector to achieve universal energy access.
Indisputably, this will put the continent steadily on the path to socio-economic growth, and sustainable development.

OpEd: Why financing Africa’s energy infrastructure is a major opportunity for investors

JOHANNESBURG (Reuters) &#8211; South Africa’s state-run power firm Eskom said on Tuesday it is planning its first major battery storage project as President Cyril Ramaphosa seeks to boost renewable energy usage and reduce the country’s reliance on coal.
Prince Moyo, general manager for power delivery engineering at Eskom, told Reuters that the battery storage project would be rolled out in phases across 90 sites, with a tender for the first phase pencilled in for early next year.
“At this stage the focus is on storing energy for the benefit of all our customers. The aim is to ensure security of power supply,” Moyo said.
Although the 1,440 megawatt hour per day battery project would be able to store less than one percent of Eskom’s total generating capacity, it is a sign the utility is following through on promises to prioritise renewable energy ventures.
The project should also help smooth relations with the World Bank, which had become frustrated over the slow progress made on renewable power plans since it approved a more than $3 billion loan in 2010 to support green energy.
Eskom, which joins global firms like oil major BP and General Electric in investing in battery storage, is working on a new long-term strategy to assess whether its business model is sustainable.
The utility’s new management, appointed soon after Ramaphosa replaced scandal-plagued Jacob Zuma as leader of the ruling African National Congress last December, is fighting to rescue the firm after a period of steep financial decline.
It reported a 2.3 billion rand ($160 million) loss for the latest financial year, after which it said it was considering selling non-core assets and job cuts.
($1 = 14.3534 rand)
Reporting by Alexander Winning; Editing by Joe Brock

First major battery storage project in works for South Africa’s Eskom, what you need to know

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Operators in Nigeria’s energy space are clamoring for government&#8217;s intervention on tariff hikes for solar panel importation. Segun Adaju, President of the Renewable Energy Association of Nigeria joins CNBC Africa to discuss the details and its implication on Nigeria’s bid to improve its energy mix.

Nigerian operators slam tariff hike on solar panels call for govt intervention

JOHANNESBURG (Reuters) &#8211; South African trade unions ended a pay dispute with state power firm Eskom on Thursday, removing a major obstacle to President Cyril Ramaphosa’s efforts to guarantee uninterrupted power supplies while reforming the struggling utility.
Three unions — the National Union of Mineworkers (NUM), National Union of Metalworkers of South Africa and Solidarity — signed a three-year deal that will see Eskom workers receive a 7.5 percent wage increase this year and a 7 percent increase in each of the following two years.
The agreement places an added burden on Eskom’s strained finances but reduces the risk of a repeat of the power outages experienced during several days in June and July that which cast a cloud over Ramaphosa’s economic reform programme.
Cash-strapped Eskom is one of the biggest threats to South Africa’s sovereign credit ratings, which are near “junk” status. It is desperate to push ahead with a turnaround plan.
The state-owned utility supplies more than 90 percent of the country’s power, has around 270 billion rand ($18.6 billion) of state-guaranteed debt and is a major employer, with around 47,000 staff, a figure its new board wants to trim to repair the firm’s balance sheet.
When talks with trade unions began several months ago, Eskom offered no increase in salaries. But it backtracked after protesting workers forced some generating units to be switched off, leading to the first power outages since 2015.
“The 2018 Eskom wage negotiations have been the most difficult ever in the history of the NUM,” the union said in a statement.
Eskom said the conclusion of the wage talks meant it could focus on its turnaround plan.
The wage deal agreed on Thursday is around 2 percent above consumer inflation-linked increases National Treasury promised as part of a fiscal consolidation plan key to Pretoria retaining its last investment grade credit rating.
Moody’s, the last of the “big three” ratings agencies to have South Africa’s sovereign rating in investment grade, said this month that the pace of fiscal consolidation in South Africa had slowed.
Analysts expressed cautious optimism about the wage deal being reached, but said it would be a drag on Eskom’s near-term financial performance and could worry ratings agencies.
“It is definitely ratings negative, but it is not the straw that breaks the camel’s back,” energy analyst Mike Levington said. “It’s good they’ve signed the agreement, but they’ve ignored the bigger problem of Eskom’s sustainability. It’s very clear that retrenchments (layoffs) are going to be part of that.”
($1 = 14.5254 rand)
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&#8211; Tanisha Heiberg, Mfuneko Toyana
Editing by Alexander Winning and Edmund Blair

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