South Africa’s debt-stricken power utility Eskom has unveiled an ambitious plan to drastically expand renewable energy capacity while slashing coal reliance by 2040, a bold move to transform a beleaguered system amid crippling financial challenges.
In a presentation to lawmakers on Wednesday, Eskom outlined its vision to boost renewable capacity from less than 1 GW to 32 GW over the next two decades, while reducing coal-fired generation from 39 GW to 18 GW.
The strategy hinges on “repowering” ageing coal plants with renewable and gas-fired alternatives and marks a significant departure from the company’s historic coal dependence.
Repowering coal plants to accelerate transition
Eskom has already identified six coal-fired power stations for repowering projects, aiming to deliver 5 GW of clean energy capacity through this approach.
Construction on 2 GW of projects is expected to begin by 2026. To steer this transformation, the utility is establishing a dedicated renewable energy unit tasked with implementing the strategy and partnering with private sector players.
Financial hurdles threaten progress
Despite its forward-looking vision, Eskom’s debt burden remains a formidable obstacle.
The utility carries around ZAR 400 billion (US$22 billion) in debt, constraining its investment capacity and operational flexibility.
Compounding the problem are billions of rands owed by local municipalities and government-set electricity tariffs that fall short of covering Eskom’s costs.
Industry experts caution that unless these financial and regulatory challenges are resolved, Eskom’s renewable pivot could stall or slow substantially.
Aiming for cleaner power by 2040
South Africa’s total installed capacity currently stands at about 63 GW, with solar and wind contributing just 11 percent and five percent respectively.
The government targets 4.5 GW of wind and 3.7 GW of solar capacity by 2030, milestones now seemingly within reach thanks to Eskom’s renewed commitments.
If successful, Eskom’s plan could not only curb the nation’s carbon footprint but also enhance grid resilience, create jobs, and position South Africa as a leader in Africa’s clean energy transition.