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Grid Access Unit for IPPs and generators Small and Micro Generation Framework Frequently Asked Questions & Answers 22 October 2014 1

# Question/Issue or concern Answers 1 2 3 4 Can a residential customer connect his PV system to the Eskom grid? What is low voltage? Does Eskom buy energy sent into the grid? What happens if I am already connected? No. Eskom doesn t allow customer owned generation to connect to the Eskom low voltage network. Any connected voltage that is less than 1000 volts. Generally residential customers take a single phase supply of 230 volts (plug point voltage). Businesses generally take a 3 phase supply of 400 volts. Eskom only offers a revenue offset on the customer accounts for larger installations. These are installations where the supply voltage to the customer is on the medium voltage level i.e. greater than 1000 volts. You have to contact Eskom if you are an Eskom customer. The PV system has to be disconnected from the grid. You will only be able to operate in a Stand-by manner (with a proper chop over system), until Eskom provides you with compliance,. 5 Does Eskom support the connection of small scale generators to the grid to help drive the renewables business in SA? 6 I want to connect PV panels on the roof of my house. Can I connect these to the network? 7 When will customers be allowed to connect the generation to the Eskom grid? Yes, Eskom supports the connection of generators to our networks. We are working on a process to deal with small scale generators but as this is new business for Eskom, we have to ensure that all safety measures are in place. You can install a PV system for your home in a similar manner to that of a stand-by generator. This means that only part of your home will be permanently supplied by the PV systems or diesel generator or the Eskom supply is disconnected before using the generation. Eskom is currently working together with the SABS on getting the LV wiring standard to be changed to accommodate LV generation connections that want to operate in parallel with the grid. The customer has only two options currently viz. Option 1: change the supply voltage to medium voltage and go on a large power tariff. This option is however not available to customers who do not have dedicated Eskom transformer supplies. Option 2: Operate the system in a similar manner to that of a stand-by generator. This means that only part of your home will be permanently supplied by the PV systems or diesel generator or the Eskom supply is disconnected entirely before using the generation. The execution of isolation or separating from the Eskom supply has to be done in the main distribution box 2

through a proper mechanical change over switch. Option 1 is an expensive option as there will be additional costs that the customer will have to pay for and this extends into the hundreds of thousands of rands. # Question/Issue or concern Answers 8 9 10 11 Does it matter if I am supplied by Eskom or a Municipality if I want to connect my generation Who does a customer contact to find out about connection to the grid? Where do I get installers for PV roof mounted systems? How do I get a certificate of compliance (COC) for my roof top PV installation? 12 Is Eskom and the munics working together to get all the challenges resolved? This document is for Eskom connected customers. You can contact the Eskom Contact Center, who will direct you to the relevant person that can answer additional queries. A list of accredited installers and equipment should be provided by SABS once there is certainty on the LV wiring standard. This is currently not in place in SA. A COC can only be obtained once the LV standard changes have been made and published regarding LV generates that want to operate in parallel with the grid. Eskom and municipalities are also part of a SALGA workgroup, the aim of which is to develop a national approach. This workgroup is being advised by sponsored international experts and will consider all aspects like the technical standards, the administrative processes and the electricity tariffs that should be used. 13 What tariff does a customer get for energy 14 exported into the grid? I am aware that Eskom is in the process of developing a framework for small scale embedded generation. What will this framework cover and when will it be released? Low voltage customers can t connect to the grid currently to export power. Once the technical rules around connection have been addressed, Eskom will work with NERSA with regard to an offset type tariff for small power users. The offset tariff is where a customer will get a revenue credit for energy sent into the grid. The proposal for offset is still only in draft format. It covers, the technical, pricing and contractual, operational, process excellence, application, quotation, billing and payment requirements, required to establish and implement this framework. It is anticipated that the complete framework will be achieved in 3 years time however it can be operated in a partly competed state in the meantime. In order to be operated in this mode, there are some critical minimum requirements needed, which have not yet been fulfilled. We anticipate fulfilling these minimum requirements before the end of the current year. It should be noted that Eskom is preparing 3

for itself whilst waiting for the National Policy on small and micro embedded generators. # Question/Issue or concern Answers 15 In the meantime, can you explain how Eskom is currently managing small scale generators that want to connect to the Eskom grid? a) Are small scale generators permitted to connect to the grid? b) Are small scale generators permitted to export energy on to the grid? c) What size connections do you allow? a) No, they are not allowed to connect currently. b) Once the technical aspects of the framework are complete, the generators will not be prohibited from exporting. Eskom doesn t however have a tariff for small power users to be compensated for the exported energy. The tariff is in a design stage currently. c) There are strict guidelines for size of connection as part of the published NRS 097-2 -3 standard. 16 17 d) Do you pay small scale generators for the energy that they put back onto the grid? If so, how and at what rate? How many small scale generators are connected to the Eskom grid that you are aware of? Please explain the process involved for a small scale generator that wants to connect to Eskom s d) Eskom is a regulated company and our tariffs are approved by NERSA. SA currently does not have feed-in tariffs for small generation (a tariff above regulated tariffs). The DoE currently only looks at large scale generation projects. We do have an off-set tariff for exported energy but only for large power user supply account customer holders (LPU tariffs as per Eskom tariff book). The offset tariff will be at the Eskom wholesale electricity pricing tariff schedule (WEPS which is basically the average overall Eskom cost of generation). We don t have a compensation tariff for Small Power User account holders currently but this is being drafted currently. There are none connected currently to our knowledge but Eskom suspect that there are probably about 500 installations connected, without the permission or knowledge, in SA. Where Eskom knew about the connection, customers were instructed that the generation should be operated in an island or standby mode independent of the grid. The process is not finalised but there will be an application form to be completed which can be done via the Eskom internet or Eskom Contact Centre. An on-site inspection will take place and 4

18 Grid Access Unit for IPPs and generators grid. (ie. application form, metres required etc). What criteria are involved in allowing connection? Who is my grid access advisor? GAU Senior IPPs Executives an Eskom quotation for work, if any, to be done. Once all technical conditions have been fulfilled, the customer will enter into a connection agreement with Eskom. While we setting up the final process, we will in the interim deal with applications in a more hands on individual manner rather than via a mass market type solution. The meters will be an Eskom off the shelf meter that can record energy in the forward and reverse direction separately. We will not install meters that net the energy i.e. reversing meters Please peruse a list of Grid Access Unit (GAU) advisors below as per the province of interest. GAU Regions Provinces Snr IPPs Execs Names Office # Mobile # Region 1 Region 2 Region 3 Western Cape Eastern Cape Bradley Box 021 915 2776 072 245 9345 Are van Zyl 021 915 2570 082 495 5705 Livhuwani Nedzingahe 021 915 2479 076 304 6953 Eddie Leach 043 703 5385 082 886 2802 Tembi Plaatjie 043 703 5335 082 924 7186 Free State Lebohang Motoai 051 404 2582 083 710 1272 Northern Cape Lebohang Motoai 051 404 2582 083 710 1272 Moreetsi Balepile 051 404 2185 076 494 3357 Kwa-Zulu Natal Ravi Moonsamy 033 395 3737 083 635 0253 Zanele Kamwendo 031 240 8078 082 631 1600 North West Sibongo Simelane 011 516 7047 083 684 9028 Selloane Thulo 011 516 7825 083 306 8111 Limpopo Valmon Muller 011 711 2707 082 826 3327 Gauteng Lorato Loate 012 421 3091 083 309 3637 Mpumalanga Nthabiseng Llukhozi 016 362 3591 078 503 1411 5

Modikoe Makhene 011 871 3329 082 829 2570 Charmaine Masehela 011 871 2122 078 457 1635 6