Renewables to cover 30% of Vodacom SA’s energy demand

Vodacom South Africa is set to get approximately 30% of the group’s electricity demand covered by renewable energy sources through virtual wheeling, it confirmed on Monday.

This comes after the telecommunications giant signed a virtual wheeling agreement with state-run power utility Eskom in August this year.

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According to the group, virtual wheeling will address the challenges of traditional wheeling by “incorporating smart metering, removing the need to amend the customer’s supply agreements, and extending wheeling to customers connected at low voltage”.

Vodacom believes the agreement with Eskom has the potential to pave the way for other corporates equally interested in meeting key decarbonisation goals, while still supporting the stability of the country’s ailing national grid.

“Having co-developed the virtual wheeling solution with Eskom and concluded our agreement, we estimate that we will move approximately 30% of Vodacom South Africa’s power demand onto renewable sources, a significant step towards our renewable energy ambitions,” Sitho Mdlalose, Vodacom SA’s CEO said.

“We are really excited that we have the opportunity to contribute to the national grid, and truly hope that through sharing our understanding of virtual wheeling and engaging both government and private participants on this solution, similar actions can be taken by other businesses across the country,” he added.

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Eskom’s ‘virtual wheeling’ move

Vodacom, Eskom and the National Business Initiative (NBI) recently held a knowledge-sharing session with energy industry stakeholders with the aim of shifting the perceptions of power generation in the country.

Eskom’s distribution group executive Monde Bala said virtual wheeling will help improve the security of supply and cut down on load shedding.

“Virtual wheeling allows industrial and commercial customers connected to either Eskom or municipal networks to buy electricity directly from Independent Power Producers [IPPs]. This has a knock-on effect of increasing security of supply and reducing load shedding by unlocking investments in new generation capacity by IPPs at no cost to Eskom or the taxpayer,” he explained.

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“Virtual wheeling does not require changes to existing Electricity Supply Agreements and is not limited by municipalities that do not have wheeling frameworks. However, Eskom will only process the refund of an off-taker or municipality whose Eskom account is in good standing,” added Bala.

NBI CEO Shameela Soobramoney stressed the sustainability benefits of virtual wheeling and the benefits it offers businesses in desperate need of operational continuity.

“Virtual wheeling effectively enables the transmission of renewable energy across different parts of the grid in a practical and accessible way, making it not only a business imperative, but a pivotal component of the Just Energy Transition,” she said.

“As business leaders, and from a strategic corporate standpoint, the significance of virtual wheeling cannot be overstated as an indispensable lever in South Africa’s burgeoning renewable energy market,” Soobramoney added.