IPP to inject R47b into SA economy

Independent Power Producers will contribute to additional capacity on the national electricity grid.

Energy Minister Dipuo Peters speaks on South Africa's electricity generation capacity during a briefing in Centurion on 3 December 2009. Picture: Werner Beukes/SAPA

PRETORIA - Independent Power Producers (IPP) will contribute to additional capacity on the national electricity grid, create jobs and inject billions of rands into the South African economy.

Energy Minister Dipuo Peters announced in Pretoria on Monday that her department was ready to sign power purchase agreements with 28 successful bidders.

Peters said the companies were expected to provide an additional 1,400 megawatts to the grid.

"These bidders will be investing about R47 billion in power generation projects, and will create a number of jobs during the construction and operation of these power plants."

She said government was expected to conclude even more power generation contracts.

"There will be]2,652 megawatts of gas power in the system by 2025 and 2,609 megawatts of hydro power, including regional projects in the system by 2024."

The department's deputy director-general, Ompi Aphane, said producers will sell the power as they are able to produce it.

The IPP takes a risk as to how much wind and sun they can convert to electricity.

"So when they produce, we pay, when they don't produce, we don't pay - irrespective of the capacity."