A new study commissioned by the South African Wind Energy Association (SAWEA), against the backdrop of volatility and uncertainty in the current electricity landscape in SA, has revealed that the role of Distributed Generation Renewable Energy (DG-RE) in the SA electricity market is currently undervalued and that it has a significant role to play in supporting the delivery of clean, cost effective and reliable power to South African business.

Launched at the at Res4Med&Africa Innovation Conference in Cape Town on Monday, the
SAWEA study examined 14 different scenarios in five different SA municipalities. The study
found that wind and solar systems embedded in distribution networks could reduce
significant load on municipalities; lowering the price of electricity, preventing electrical
interruptions, reducing losses and providing an effective and efficient contribution to
resolving SA’s power crisis.

“Within the current regulatory environment, improvements in renewable energy technology
and falling prices are not reaching consumers directly and quickly enough and it is within this
context that the report should be considered,” says CEO of the South African Wind Energy
Association, Brenda Martin.

Distributed generation refers to a variety of technologies that generate electricity at or near
where it will be used, such as solar PV panels, wind and combined heat and power and may
or may not make use of existing electricity infrastructure for distribution to customers.

“Distributed generation can directly serve loads behind-the-meter as we have seen
increasingly in SA over the past years, but they can also make use of existing public network
infrastructure to supply offtakers that are not co-located with the energy plant. This type of
scheme presents a number of advantages at various levels, and this is what we wanted to
better understand through the study” explained Kevin Minkoff, chairperson of SAWEA’s
Technical Working Group.

He said Eskom tariff increases and continued struggles only strengthened the business case
for DG-RE plants and the role these could play in supporting the sustainable delivery of
power.

The report also highlights opportunities for investors. “This is an exciting time for current and
prospective investors in the growing South African renewable energy market,” said Martin.
“This is an important piece of work for entities interested in investment other than utility-scale
as it reveals opportunities and potential routes for corporate PPAs (power purchase
agreements) to step forward to become part of the solution to SA’s power woes by relieving
pressure on the grid.”

Minkoff explains that PPAs support the purchase of electricity at an agreed price for an
agreed period, typically 10-20 years. Instead of buying power directly from utilities (typically
state-owned as in SA), several businesses are now beginning to consider how to purchase
electricity from independent generators, as well as investing in generation assets
themselves – within the strict limits of the current regulatory framework.

“PPAs have economic and environmental advantages,” says Martin, adding that large
multinationals are beginning to apply their sustainability pledges to their global supply chains
and data centres, which has led to a significant uptick in corporate PPAs globally.

“However, in South Africa, current regulations are restricting the uptake of corporate PPAs.
To support growth of the industry, the SAWEA report calls for regulatory reforms to allow for
direct PPAs between municipalities and energy intensive users and details how this could
provide security of supply to heavy industry at lower tariffs,” said Martin.

“It important for local municipalities and utilities to revise planning methods, devise new
technical specifications and update commercial arrangements.”
Investing in DG-RE plants can help corporates to meet environmental targets, giving them
an instrument to evidence compliance with increasing climate change reporting and
corporate governance requirements.

Norwegian energy group Statkraft has unveiled a virtual power plant in the UK which connects wind, solar and gas engines with battery storage and can respond to market demands in seconds.

“The idea is to match renewable power production with market demand within seconds,” said Duncan Dale of Statkraft in the UK. “The increasing share of renewable energy in the UK will require a maximum of flexibility in the British power grid. By integrating batteries and engines into the virtual power plant and optimising their operations we can provide this flexibility reliably.”

The virtual power plant monitors the operations of more than 1000 MW of wind, solar, battery storage and gas engines. It compares it with constantly-updating Day Ahead, On-the-Day and Cash Out (indicative electricity imbalance) price forecasts, allowing what Dale calls “real time optimisation of power trading in the British energy market”.

And Statkraft is planning to double the capacity of the virtual power plant by the summer. Dale said that making best use of flexibility will facilitate the integration of intermittent power generation into the electricity system and by that the expansion of renewable energy in the UK.

Software from German firm Energy & Meteo Systems will connect, coordinate and monitor the decentralised sites, storage facilities and controllable loads, via a common intelligent control centre.

In doing so, it can act within various energy markets as would a conventional power plant. Dr Ulrich Focken, founder of Director of Energy & Meteo, said that combining these functionalities with optimised power forecasting means that “fluctuating, decentralised power sources can be reliably integrated into the energy grid and profitably marketed at an energy exchange”.

In Germany, Statkraft already interconnects more than 1400 wind and solar installations in what is Europe’s largest virtual power plant, with an installed capacity of around 12,000 MW. 

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With South Africa’s state electricity utility in dire financial straits and straining to meet demand, the government has reverted to courting independent renewable energy producers to help power the continent’s most industrialized economy.

President Cyril Ramaphosa, his Energy Minister Jeff Radebe and the Treasury have all recently heralded solar and wind-powered plants as the answer to meeting South Africa’s future electricity demands, citing falling costs and environmental considerations. The government also needs private investors to help fund new infrastructure: Eskom Holdings SOC Ltd., which generates about 95 percent of the nation’s power, can’t afford to maintain its aging coal-fired plants, never mind build new ones, and the Treasury has no cash to spare.

Renewable energy companies have reason to be skeptical. South Africa initiated one of the world’s most successful renewable-power programs starting in 2011, which garnered more than 200 billion rand ($14.4 billion) in investment from 112 producers. But projects were stalled for almost three years during ex-President Jacob Zuma’s rule as he and Eskom officials pushed to build nuclear plants, a deal that was tainted by corruption allegations and was shelved when Zuma was forced to step down a year ago.
​

​“They’re putting things right,’’ said Mike Rossouw, an independent energy adviser. “The renewables outlook is getting better and better.’’
Read more on how the Zuma administration derailed renewable energy.
Eskom’s operational and financial woes stem from years of mismanagement and massive cost overruns on two new coal-fired power stations that should have been finished in 2015 but are running years behind schedule. The government now plans to split the utility, which produces three-quarters of its power from coal, into generation, transmission and distribution units in a bid to get it back on track. The move should make it easier for the renewable energy plants to supply the national grid.
That’s imperative because financiers are becoming increasingly reluctant to fund coal-fired projects, amid a global move toward more environmentally friendly forms of energy, according to Radebe. The shift will be aided by improvements to batteries and other technological advances, he said.

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After setting a record in 2015 for the most consecutive days of using solely renewable energy, Costa Rica has bested themselves and beat their own record by going 300 straight days using only renewable energy. 
The country gets its clean energy from a variety of sources, with hydropower being the largest provider — making up 78 percent of the country’s renewable energy, per Newsweek. Wind and geothermal energy each make up 10 percent of the nation’s clean energy, followed by biomass and solar each at around 1 percent.
​ 
While the feat of nearly one year using only clean energy is an impressive feat, there is a bit more to the story: The figure only applies to electricity — and gas usage for powering vehicles and providing heat were not surveyed. 
Dr. Monica Araya — a clean development adviser for Costa Rica — called the latest accomplishment “fantastic,” but readily admitted that the country still has a way to go in terms of clean energy. 

She explained, “It hides a paradox, which is that nearly 70 percent of all our energy consumption is oil.” 
Despite existing challenges, Costa Rica has long been dedicated to sustainability and, earlier this year, became the first country to ban fossil fuels. The country’s new president, Carlos Alvarado, made the announcement of their plan to become the first decarbonized country in the world during his inauguration in May of this year.  

“Decarbonization is the great task of our generation, and Costa Rica must be one of the first countries in the world to accomplish it, if not the first,” he declared. “We have the titanic and beautiful task of abolishing fossil fuels in our economy to make way for the use of clean and renewable energies.”

Earlier this year, President Alvarado announced plans put in place to end fossil fuel use in the country 2021 — the same year that marks the 200th anniversary of Costa Rican independence.

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The wide-scale adoption of renewable-energy projects throughout South Africa will result in a more cost-effective and cleaner national energy supply, says renewable-energy development and management company G7 Renewable Energies.

“About 20 years ago, the renewables debate was about environmental considerations and whether it was necessary to introduce cleaner forms of electricity generation,” explains G7 Renewable Energies MD Kilian Hagemann.
However, he adds that now the growing global popularity of renewables is enabling original-equipment manufacturers to lower the costs associated with renewable-energy equipment through economies of scale and efficiency improvements.
For instance, the shift towards competitive auctions worldwide has accelerated the product development cycles of turbine manufacturers in the wind industry, with manufacturers producing bigger and more efficient models – which allow for a lower cost of electricity and hence greater competitiveness – every year, Hagemann explains.

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He says, while opponents of wind and solar energy have been outraged by reports that State-owned power utility Eskom is paying independent power producers (IPPs) an estimated R2/kWh – which applies to less than 5% of the total installed generation in the country – supporters of renewables point out that these costs have come down to R0.6/kWh over five bidding rounds under the Renewable Energy Independent Power Producer Procurement Plan (REIPPPP).

Hagemann adds that the first round of renewable projects procured in 2011 are being paid more than the reported R2/kWh, while the third-round facilities are being paid less, reiterating that the uptake costs for renewable projects are continually decreasing.

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There is considerable support in South Africa for the notion that a transition in the electricity system from coal to renewable energy will trigger a jobs bloodbath at both Eskom and the Mpumalanga coal mines. A detailed analysis of the job numbers, however, suggests quite the opposite. In fact, it points to there being at least 30% more jobs in a fleet comprising solar photovoltaic (PV) and wind farms when compared with an energy-equivalent coal fleet.

The Department of Energy’s (DoE’s) Integrated Energy Plan includes a study on the job-intensity of different power-generating technologies. Applying these assumptions to two hypothetical power systems with the same yearly energy output will be indicative. To achieve a 100 terrawatt-hour per annum (TWh/a) production rate with coal-fired power stations, a 14 GW fleet would have to be built, operated and maintained in perpetuity. With a lifetime assumption of 30 years, roughly 0.5 GW of new coal-fired plant would need to be built yearly, in perpetuity, to sustain the 100 TWh/a output. Applying the DoE job-intensity data suggests that such a fleet would create 20 486 permanent direct jobs in construction (at the 0.5 GW/a build rate) and operations of the associated coal mines and the power stations.

​Achieving the same 100 TWh yearly outcome using wind and solar PV plants would require a 45 GW fleet, comprising 25 GW of solar PV capacity to produce 50 TWh/a and a 20 GW wind fleet to produce the 50 TWh/a balance. Solar PV plants have a lifetime of 25 years, wind farms 20 years. Hence, 1 GW each would need to be built yearly, in perpetuity, to keep the output constant at 100 TWh/a. Building and operating such a fleet in perpetuity will require 26 475 permanent direct jobs – 15 125 in construction and 11 350 in operations. Hence, significantly more jobs are needed to build and operate a renewables fleet in perpetuity than is the case for a system based on coal, and that is without adding the jobs required in the flexible power stations, such as gas, biogas or batteries, needed to balance the renewables-based system.

How do these theoretical numbers compare with reality?

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President Cyril Ramaphosa has announced a plan to rescue state-owned power company Eskom by separating it into three units. According to consultants Frost & Sullivan, although that may not be enough to completely address the utility’s financial crisis it may further encourage investment in renewables.
FEBRUARY 11, 2019 EMILIANO BELLINI
South African president Cyril Ramaphosa used his State of the Nation speech to address one of the key issues facing the country’s energy sector, the long-running financial crisis at state-owned electric utility Eskom.

The struggles of the power company have represented the main roadblock to the deployment of solar and other renewables in South Africa in recent years.

Ramaphosa said, in his speech last week, bold steps must be taken to avert a crisis at the utility. “To bring credibility to the turnaround and to position South Africa’s power sector for the future, we shall immediately embark on a process of establishing three separate entities – Generation, Transmission and Distribution – under Eskom Holdings,” the president said. “This will ensure that we isolate cost and give responsibility to each appropriate entity.”

The split, Ramaphosa said, would also enable the three new entities to better raise funding. “It is imperative that we undertake these measures without delay to stabilize Eskom’s finances, ensure security of electricity supply and establish the basis for long-term sustainability,” he added.​

Eskom’s debt mountain, according to its financial results, stood at around ZAR419.2 billion ($30.8 billion) at the end of September. As Eskom is the buyer of the power generated thus far under the country’s Renewable Energy Independent Power Producer Procurement program (REIPPP), its lack of funds has pushed it to delay the signing of several PPAs awarded in rounds 3.5 and four of the program.

Despite that slowdown, 27 outstanding PPAs were signed in April and a new 1.8 GW round to be held this year was announced.

In March 2017, French development agency the AFD agreed to provide Eskom with a multi-tranche ZAR6 billion credit facility, intended for projects which are part of the utility’s grid improvement plan to integrate renewable energy and develop transnational power supply networks.

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Performance of South Africa’s small, but expanding, renewable-energy fleet point to a positive contribution from the country’s wind and solar plants during those hours towards the end of 2018 when Eskom resorted to load-shedding.

Compiled by the Council for Scientific and Industrial Research (CSIR) Energy Centre, the statistics highlight a particularly strong correlation between the daily generation profile of the country’s 1 479 MW solar photovoltaic (PV) fleet and the times of the day that load-shedding occurred in June, July, November and December.
​In total, Eskom resorted to rotational power cuts on 12 days last year, equating to 128 hours of either Stage 1 (1 000 MW), Stage 2 (2 000 MW), or Stage 3 (3 000 MW), or about 138 GWh of unserved energy.

The utility began resorting to load-shedding again in 2019, declaring Stage 4 (4 000 MW) from 13:00 on February 11. Eskom last declared such a large level of load-shedding during its 2014/15 financial year under its previous Stage 3 definition, which had a wider range and which has since been revised to one where each stage represents 1 000 MW.

Last year, most of the incidents took place in late November and early December. Supply has been negatively affected by the fact that Eskom’s summer maintenance coincided with high levels of unplanned breakdowns across the coal fleet, exacerbated by inadequate coal supplies, poor coal quality and sub-par contributions from the units in commercial operation at the Medupi and Kusile power station projects.

Although still a small contributor to South Africa’s overall production of electrical energy, the CSIR statistics show that the country’s operational utility-scale wind, solar PV and concentrated solar power (CSP) plants helped mitigate the impact of the system’s imbalances.

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CAPE TOWN (miningweekly.com) – The mining sector has been encouraged to use more renewable energy and tighten up on energy efficiency, with the support of the South African National Energy Development Institute (Sanedi).
Energy Minister Jeff Radebe said the mining industry would need innovative and novel solutions to reduce energy consumption and produce more with less. It also needed ways to reduce the high carbon content of certain products and high-emission processes.
“Sanedi is ready to explore the best possible approaches and practices to relieve and assist the mining sector in introducing reliable and affordable sustainable energy while moving away from some of the traditional and conventional practices,” the Minister said in a speech read by the Department of Energy’s deputy director-general Mokgadi Modise, during the Investing in African Mining Indaba, on Tuesday.

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