JOHANNESBURG - South Africa's renewable energy independent power producers (IPPs) are facing growing financial pressure as electricity curtailment increases.
With solar plants generating large amounts of electricity during the day, Eskom is often left with more power than the grid can absorb.
As a result, some renewable energy generation is curtailed, with producers compensated for electricity they are unable to supply to the grid.
Energy analyst Chris Yelland says Eskom has been slow to reimburse IPPs for curtailed electricity, with some payments delayed by as much as a year.
According to Yelland, Eskom attributes the delays to a sharp increase in curtailment volumes and limited capacity to verify and process claims.
Yelland argues that curtailment is not the most effective solution. Instead, he says South Africa should encourage greater electricity consumption during periods of surplus by introducing lower daytime tariffs.
"What we should be doing is offering very attractive prices to encourage consumption and to encourage what we call arbitrage," he says.
"In other words, people who own batteries should be able to buy electricity when prices are low, charge their batteries, and then sell that electricity back when demand is higher, for example during the evening peak."
He says this would allow battery owners to store excess electricity generated during the day and feed it back into the grid when demand peaks in the evening.
According to Yelland, making better use of surplus electricity through energy storage would be far more efficient than curtailing renewable generation, wasting available energy and compensating producers for power they could have supplied.