As I sat over Christmas waiting for electricity to boil a kettle, the grinch in me knew that load-shedding is bad and going to get worse.

Three months ago I was ready to bet that we would see the end of load-shedding by late 2024, but the failure of bid window 6 of the renewable energy independent power producers’ programme (REIPPP) late in 2022 has thrown the outlook for energy security into disarray.

We were set to be adding 6GW-7GW of new capacity each year for several years, expanding at roughly 20% of present production per year. That was going to be achieved with utility scale procurement through REIPPP and capacity creation by the private sector — from roof top solar to large-scale generating facilities by mines and other large energy consumers. Eskom was also coming to the party by leasing land in Mpumalanga for private operators to build new capacity.

Bid window 6 was going to be the largest energy procurement round yet. Faced with the escalating crisis, minister Gwede Mantashe doubled the procurement target to 5.2GW. This move triggered excitement, indicating that the government might be ready to do what it takes to accelerate the construction of large-scale energy production. In October 56 projects bid to produce electricity in the round, with a combined capacity of 9.6GW. So far, so good.

But when the REIPPP results were announced, only five bidders were chosen, producing a total 860MW. That is about 17% of the full 5.2GW. There has been far too little outcry about this result. It is a disaster.

The reason for the huge shortfall is that Eskom says it is cannot provide grid capacity to link more of the projects to the national grid. This was a slap in the face.

Only in March, Eskom had published its Generation Connection Capacity Assessment out to 2024. The REIPPP bidders had made their submissions with an eye on Eskom’s forecasts. That had shown there was capacity in areas with suitable wind and solar conditions, including the Eastern Cape, Western Cape, North West and Free State. The only no-go area in assessment was the Northern Cape, swamped by previous REIPPP projects.

What then happened has been difficult to fully understand. The approved projects are all in the North West and Free State (Eskom had indicated capacity of 4.1GW in the Free State and 3.5GW in the North West). These are all solar projects. The wind bids were in the Western Cape and Eastern Cape and none were successful. Eskom had indicated that these two provinces had thin grid capacity of 1.8GW and 1.6GW respectively.

Eskom says that its capacity forecast has been used up by private sector off-taker projects. These are new generation projects by large industrial users. Somehow, between Eskom’s grid forecasts, and the REIPPP bids, Eskom signed agreements with private- sector operators that swamped its capacity in two critical provinces.

A lot of questions should be asked here. How does Eskom prioritise who to sign grid access agreements with? What transparency surrounds these decisions? How could the whole country have been caught by surprise by the REIPPP outcome?

Grid capacity still exists — there is a lot in Mpumalanga, for instance (6.5GW). The grid is coal centric by design and most capacity is near that resource. Unfortunately, Mpumalanga provides weak wind and solar resources so there is a big mismatch. Nevertheless, Eskom is moving ahead to create renewable production in the province, on the view that higher generating costs are compensated by low grid costs. There also appears to still be capacity in KwaZulu-Natal, the northeast of which has reasonable wind conditions. Future REIPPP bidders can look at these areas and locate projects where Eskom capacity is available. It will become difficult and expensive to do, however.

The grid capacity conversation now becomes central to SA’s energy outlook. The country’s solar resources are substantially in the Northern Cape, while the wind blows best in the Eastern Cape and Western Cape.

The grid needs to be reoriented from its Mpumalanga focus to these regions. However, grid capacity projects are expensive. International prices have high voltage lines at about R20m per kilometre, but the associated distribution infrastructure and substations add significantly.

Connecting Upington to Johannesburg over 800km would cost R16bn for the lines alone. A project requires expropriation of land, and complex system engineering challenges that can take years to resolve. In short, creating generating capacity is much easier than the grid to absorb it.

Eskom maintains a Transmission Development Plan it updates at least every five years. The last one in 2022 envisaged investment of R72.2bn for 2,890km of high voltage lines and 60 new transformers over the next five years. But this ambition clashes with Eskom’s huge debt levels and challenges in financing new capital investment.

To restore optimism, we need a serious and credible plan for the grid. It needs to ensure we can tap the abundant renewable resources across the country. It needs a proper financial plan that overcomes Eskom’s constraints. This must be our priority for the year ahead.

• Theobald is chairperson of research-led consulting house Intellidex. This article first appeared in Business Day.