South African electricity public utility, Eskom has launched a Renewable Energy Tariff pilot programme to engage with businesses who need to meet their renewable energy commitments. The programme aims to source clean electricity supply to Eskoms customers, with up to 100 per cent supply from renewable sources. This would enable businesses to meet their clean energy targets, without entering into long-term Power Purchase Agreements or investing capital in their own renewable energy generators.

The renewable energy for the pilot programme will only be available to Eskom’s customers. While Eskom has multiple renewable electricity plants, the power for this project will initially be supplied by their Sere wind farm. A 24-hour renewable energy supply will be facilitated to the customers. The programme offers a maximum of 300 GW per annum to customers, supplied directly by Eskom. This will be done on a first-come-first-served basis.

The renewable energy pilot tariff will be a premium on the existing tariffs rates. It has been designed as a declining block tariff such that higher consumption of greener energy by a customer would lower the rate. The structure of the tariff has ten pricing blocks with each block representing the percentage usage of green energy by a customer. The blocks are in increments of 10 per cent. 

The programme is available to all Eskom customers whose electricity accounts are up to date. The pilot will end on March 31, 2023, post which Eskom will consider the viability of introducing this as a standard tariff offer to customers.

REGlobal’s Views: With an increasing focus on sustainability, businesses want to adopt green energy as part of their corporate strategy. Eskom’s program will enable such businesses to meet their green power commitments and goals without getting into the actual establishment of green energy projects at their premises or sourcing power from C&I developers.