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The Africa Energy Indaba – aimed at paving the way toward a more secure energy ecosystem – took place last week at the Cape Town International Convention Centre (CTICC), amid concerns over unprecedented levels of loadshedding being implemented across South Africa over the coming months.
Mohamed Madhi, Country Director: South Africa at Yellow Door Energy spoke at the IPP & PPA conference, a side event of the Indaba, to address delegates on the opportunities presented by Independent Power Producers (IPPs) and Power Purchase Agreements (PPAs). “A PPA enables companies to embark on an on-site power plant or to receive power from a wheeled off-site power plant with no capital outlay, while immediately benefitting from cheaper power,” explains Madhi.
He says in addition to the important role that PPAs play in facilitating the just transition to renewable energy, there is another solution that can address the more immediate crippling effects of loadshedding. “Businesses across the country are suffering significant financial losses due to the unexpected additional costs they incur when running diesel generators to mitigate business interruptions caused by loadshedding. This is a major concern, particularly with talks of even higher levels of loadshedding becoming a reality in the near future,” he asserts.
“The decade of the battery has arrived,” says Madhi. “In under five years since 2020, battery energy storage (BES) costs would have reduced by over 40%, making this a feasible option.” He explains that BES is a sustainable long-term solution available in the short-term and offers significant cost savings, greater flexibility as well as a smooth transition of power. “BES will typically save businesses around 30% in energy costs compared to running a diesel generator. That’s a significant saving for a lot of companies.”
“The last decade was all about solar, and solar will continue, but the long-term solution is going to be a combination of solar, wind and battery storage, and Yellow Door Energy is among the first to offer it at scale to the private sector,” explains Madhi. He adds that companies can significantly reduce their dependency on the grid by installing solar and combining it with a battery energy storage solution.
Yellow Door Energy is the leading sustainable energy partner, serving businesses in the commercial and industrial sectors in the Middle East, Africa and South Asia. The company’s solar and energy efficiency solutions enable businesses to reduce energy costs, improve power reliability and lower carbon emissions.
A new market entrant, Yellow Door Energy is already in the process of developing sites to wheel power across South Africa and is actively pursuing acquisition opportunities for new sites. The developer is currently in negotiations to sign agreements with several very large off-takers who will be the first to receive power from the sites they are developing.
Madhi says that Yellow Door Energy is aiming to be one of the first developers to provide in excess of 1 gigawatt of power onto the grid over the medium-term. “Because of our ecosystem of global suppliers, we are in a unique position to deploy a solution in a shorter timeframe than almost anybody else. And with plans to deploy over USD1 billion, we are fully funded and ready to execute sustainable energy solutions over the next five years,” he notes.
“Right now, we are focused on driving battery energy storage adoption to help alleviate the exorbitant energy costs associated with loadshedding,” concludes Madhi.