January 20, 2018

Renewable Energy Development Zones to aid future REIPPPP bidding rounds

By Emma Dempster, Director and Adriaan van der Merwe, Associate in Cliffe Dekker Hofmeyr’s Projects and Infrastructure Practice
On 17 February 2016 the Cabinet of the Republic of South Africa (Cabinet) approved the gazetting of Renewable Energy Development Zones (REDZs).

REDZs refer to geographical areas where wind and solar PV development can occur in concentrated zones, which will lead to:
• a reduction of negative environmental consequences;
• alignment of authorisation and approval processes;
• attractive incentives; and
• focused expansion of the South African electricity grid.
Cabinet further stated that the REDZs will, among others, accelerate infrastructure development and contribute in creating a “predictable regulatory framework that reduces bureaucracy related to the cost of compliance”.
The Department of Environmental Affairs’ media statement issued in respect of the approved gazetting of the REDZs provided that eight REDZs and five Power Corridors have been identified. The gazetting of these areas means that projects within these areas will now only be subject to a Basic Assessment and not a full Environmental Impact Assessment (EIA) process. This change will accelerate the assessment process, as scoping level pre-assessments would have been undertaken. As such an application for an Environmental Authorisation should be completed in 147 days, instead of 300 days.
The Council for Scientific and Industrial Research (CSIR) identified the following eight geographic areas for REDZ following a Strategic Environmental Assessment (SEA):
Overberg 5 263 sq km Western Cape
Komsberg 8 846 sq km Western Cape
Cookhouse 7 366 sq km Eastern Cape
Stormberg 12 041 sq km Eastern Cape
Kimberley 9 568 sq km Free State & Northern Cape
Vryburg 9 204 sq km North West
Upington 12 833 sq km Northern Cape
Springbok 15 214 sq km Northern Cape
Total 80 335 sq km
Currently one of the greatest challenges of South African renewable energy development is constraints on grid infrastructure, and the resulting timelines for and costs of grid expansion. The REDZs are anticipated to aid the future bidding rounds of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) by allowing for focused grid development and an alignment of approval processes in the REDZs. To date the REIPPPP has led to the procurement of 7000 MW of renewable capacity across 92 projects.

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