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Head in the sand: Eskom fails in a land of cheap energy

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Dom Williams of SOLA Future Energy has recently written this article for Fin24 regarding Eskom’s inability to produce cheaper energy.

Renewables pose a threat to coal and nuclear, because wind and solar are undeniably cheaper forms of energy, argues Dom Wills.

This year Eskom turned 94 years old. But so far 2017 has been one of the most damaging years yet for South African’s besieged power utility.

In 2008 and 2014 Eskom had to cope with load shedding and the power utility took a lot of heat for the rolling blackouts and the subsequent damage to the economy. Yet, during those years, Eskom was at least perceived to be the good guys doing a tough job.

This apparent positive spin led to many South Africans and businesses supporting Eskom’s initiatives to cut energy consumption and increase efficiency.

In contrast, 2017 paints a bleak picture. When compared to 10 years before, the figures speak for themselves. In 2007, Eskom sold 218 TWh electricity for 18.33c per kwh at a 16.11% profit margin. A decade later in 2017, Eskom sold less power – 214 TWh electricity for 82.66c per kWh at a 0.5% profit margin.

Thus, in the last 10 years, the state utility has grown worse off. It is selling less power, for higher tariffs, at a lower profit margin. This begs the question whether solutions exist that could reduce Eskom’s costs and boost profit. And could Eskom implement these solutions?

Click here to read the full article.

 

Energy saving technologies will help consumers prepare for massive electricity price hikes in 2018

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ePorperty News has receintly published this article on energy saving technologies that will help consumers prepare for upcoming electricity price hikes.

 

The latest ruling by the Constitutional Court, allowing Eskom to retrospectively ask the National Energy Regulator of SA (Nersa) to claw back additional tariffs from consumers could lead to further hikes in the price of electricity for South Africans.

However there is hope for homeowners to considerably reduce the impact of future increases.

This according to Cala van der Westhuizen Head of Marketing and Sales at Energy Partners Home Solutions, a division of Energy Partners, and part of the PSG group of companies, who says this latest development is expected to place consumers under even more financial pressure.

“The good news is that alternative energy generation has never been more affordable and accessible to homeowners.”

According to Van der Westhuizen, property owners can reduce their electricity costs by as much as 80% with the right combination of energy saving technologies.

“Homeowners can use their own discretion as to how much they want to save and invest in energy efficiency, but most will find that even small changes could make a noticeable difference.”

Van der Westhuizen points to the available technologies that could offer homeowners the biggest long term cost savings.

 

What homeowners need to install

 

Van der Westhuizen says that replacing the home’s light bulbs with energy efficient lighting is the first place to start. “After that, replacing your home’s geyser with a heat pump, and a highly insulated hot water storage system, cuts the home’s electricity costs by an estimated 50%. The complete heating solution costs around R35, 000 for the average home.”

Next, he says that a solar photovoltaic (PV) system can provide up to 30% of an average home’s energy. “While this type of system costs upward of R80 000, it is hugely beneficial in the long term and must be viewed as an investment. Before embarking on this, it is important to understand whether the home’s rooftop has been designed to accommodate the optimal number of panels.”

Lastly, homeowners can choose a completely integrated system, according to Van der Westhuizen. “A hybrid inverter and battery, such as Energy Partners’ own ICON Home Energy Hub, enables property owners to integrate power from their solar PV panels, the national grid and batteries. It also incorporates a mobile app to track energy usage and savings in real time.”

 

Funding options for home generation

 

Van der Westhuizen also points out that while the capital required for home generation has decreased substantially in recent years, the upfront cost of a new system can still be prohibitively expensive for many homeowners.

Energy Partners took this into account when we were looking into the affordability of our ICON Energy Hub, which is an all-in-one solution for storing and using solar energy in the home, he states. “As a result, Energy Partners developed its own financing options for the system.”

Energy Partners is an approved credit provider under the National Credit Act (NCA) and offer the financing for homeowners, he says. “Our standard terms are prime + 2.5%, financed over five years, with a 10% upfront deposit. We have also developed a long term lease model, where the client can simply lease the system from us instead of having to pay for it upfront.”

Energy Partners recently launched its Smart Living Solutions initiative in partnership with Nedbank this year. This enables qualifying Nedbank clients to invest in energy saving products for their homes as part of their existing home loans.

“Alternative energy has become a good long-term investment with great financial benefits, and innovative financing options have made this option available to even more homeowners,” Van der Westhuizen concludes.

Please click here to read the original article.

Solar delivers cheapest electricity ‘ever, anywhere, by any technology’

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Chile has just contracted for the cheapest unsubsidized power plant in the world, Bloomberg New Energy Finance (BNEF) reports.

In last week’s energy auction, Chile accepted a bid from Spanish developer Solarpack Corp. Tecnologica for 120 megawatts of solar at the stunning price of $29.10 per megawatt-hour (2.91 cents per kilowatt-hour or kwh). This beats the 2.99 cents/kwh bid Dubai received recently for 800 megawatts. For context, the average residential price for electricity in the United States is 12 cents per kilowatt-hour.

“Solar power delivers cheapest unsubsidised electricity ever, anywhere, by any technology,” BNEF Chair Michael Liebreich said on Twitter after this contract was announced.

Carlos Finat, head of the Chilean Renewable Energies Association (ACERA) told Bloomberg that the auction is “a strong warning sign that the energy business continues on the transition path to renewable power and that companies should adapt quickly to this transition process.” Indeed, in the same auction, the price of coal power was nearly twice as high!

Grid-connected solar power on Chile has quadrupled since 2013. Total installed capacity exceeded 1,000 megawatts this year — the most by far in South America. Another 2,000 megawatts is under construction, and there are over 11,000 megawatts that are “RCA Approved” (i.e. have environmental permits).

PV in Chile

Chile is aided by the fact that its Atacama desert is “the region with the highest solar radiation on the planet,” according to the Inter-American Development Bank. So much solar is being built in the high-altitude desert that Northern Chile can’t use it all, and the government is rushing to build new transmission lines.

Chile is part of a global trend where solar energy has doubled seven times since 2000. In the U.S. alone, it has grown 100-fold in the past decade thanks to a sharp drop in prices that has brought the cost of solar (with subsidies) to under four cents a kilowatt hour in many places, as I detailed last month.

The future for solar could not be sunnier.

Read the original article by clicking here.

Old Coal Mines Could Have A Future In Green Energy Storage

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Germany continues its transition from coal to renewables thanks to some clever engineering

Energiewende (energy transition). That’s the name of the German government’s ambitious goal to transform their energy landscape over the next few decades. By 2025, they want 35-40% of their electricity to come from renewable energy sources. By 2035, they’re targeting 55-60%. And by 2050, they hope to hit at least 80% renewable energy, coupled with an overall reduction in energy consumption of 25% (compared to 2008).

To get anywhere near this goal requires a huge investment in wind and solar energy generation, as well as a step up in their use of biomass and hydropower, and improving the overall efficiency of natural gas power plants. So far, signs are good, at least in terms of their energy mix. In 2015, renewable energy made up 32.5% of Germany’s total electricity demand. On one day in 2016, renewable technologies generated 55 GW of energy – that was 87% of Germany’s electricity demand on that day. As reported in Quartz at the time, there was so much electricity available, “Power prices actually went negative for several hours, meaning commercial customers were being paid to consume electricity.”

Alongside the environmental argument for renewables, there are also economic reasons a region might want to move away from coal and oil. A 2015 report from Bloomberg New Energy Finance showed that in Germany, coal and gas were more expensive than onshore wind – $106 and $118 versus $80/MWh – and the same was true in the UK. In China, coal was still cheap in 2015, coming in at just $44/MWh. But solar power there was cheaper than gas ($109 versus $113/MWh). With China now taking a leading role in the fight against climate change, the prices of renewables are likely to drop further.

The main argument laid against renewable energy generation is that it is often intermittent – the sun doesn’t always shine, and the wind does occasionally die down (though, living in Wellington, I question that second one). And this doesn’t really match with what the traditional electricity grid was designed to handle. Coal-fired power plants burn coal to produce steam, which is then used to spin huge electricity generators. These steam-powered, endlessly spinning generators do more than simply spit out a stream of AC electricity, though. They actually offer a physical stability to the system. It’s a bit like a spinning top – once you get it moving, it keeps on spinning. With something the size of a national grid, you might have hundreds or thousands of spinning turbines, all connected to each other. The benefit of this is that, if one power plant goes offline, the grid doesn’t suddenly shut down. Because they have so much rotational energy, the generators keep spinning for a little while, giving the grid managers a chance to redirect power from elsewhere, and avoid plunging a city into blackout.

Though wind turbines also produce energy via spinning turbines, if it’s a calm day, they just won’t spin. And solar panels produce DC electricity, and even then, that’s only when the sun is in the sky. How do you balance supply and demand, and keep everything stable, when you add these technologies into your grid? The only real option is to store the energy when it’s produced, and then send it back to the grid when it’s needed. And it’s in energy storage that old coal mines could play a major role.

Germany started to produce coal in the mid-1700s, and continued to rely on the fuel right through to the 1960s – the output of its many mines reached a peak in 1957. But as oil-burning and nuclear-powered plants** grew in popularity between 1960s and 1980s, the demand for coal began to decline. By the turn of the millennium, just a handful of the country’s coal mines were still in operation. In 2007, the government committed to end all subsidies for coal mining by 2018 – a move seen as the final death knell for the industry. So, like a number of other sites, the Prosper-Haniel hard coal mine in North-Rhine Westphalia will cease coal production next year. But unlike other sites, Prosper-Haniel will continue to produce power – hydroelectric power, that is.

Read the original article by clicking here.

Offgrid solar power could save electricity costs for African households

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Offgrid solar power could help lower the energy costs for 138-million households in Africa that live on less than $2.50 a day and spend about $10-billion a year on energy-related products, including charcoal, candles and kerosene, South African Solar Photovoltaic Committee chairperson Jo Dean highlighted on Tuesday.

Addressing delegates at the Power & Electricity World Africa 2017 conference, taking place over two days in Johannesburg, she said a “vibrant offgrid solar industry” is poised to take off in Africa.

She pointed to data sourced from the World Bank and the International Renewable Energy Agency that there was potential to develop up to 1 100 GW of solar capacity in Africa.

Dean stated that in many African countries, there is a lack of funding, institutional will or technical skill to develop the energy sector.

She noted that South Africa was paving the way for renewables in Africa, with the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) having encouraged other African countries to also take steps in implementing utility scale photovoltaic plants.

Meanwhile, with the uncertainty over the continuum of the REIPPPP, there is potential for new markets and opportunities to be found in South Africa’s commercial and industrial sectors.

“During 2016, 100 MW of small-scale power plants were installed across South Africa, representing a 100% increase on the 2015 amount. One estimate is that as much as 15 GW of capacity could be installed through private power purchase agreements across South Africa within the next five to ten years.”

Dean noted that many large industrial-sized businesses are likely to develop their own projects while “the market for residential-scale installations could continue growing for longer.”

She noted, however, that there are some significant challenges that will have to be addressed. Although the growth rate might be considered impressive, the market remains small.

Meanwhile, Dean noted that, to meet rapidly growing energy demand on the continent, the energy mix would gradually progress towards greater use of offgrid household systems, minigrids and embedded generation.

“It will also lead to the emergence of more flexible, hybrid national energy systems that link grids to offgrid generation,” she said.

Read the original article at Engineering News.

Zuma commits SA to renewable energy

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President Jacob Zuma committed to South Africa’s continued investment in renewable energy as part of its overall energy mix.

Eskom has for months refused to issue final budget quotes to preferred bidders in Round 4 and the Round 4 extension of the Renewable Energy Independent Power Producer Procurement Programme.

It has caused widespread concern in the renewable energy sector, which had praised South Africa for years.

There are 26 preferred bidders across a range of technologies, none of which has reached financial close due to Eskom’s refusal to sign further power purchase agreements, South African Renewable Energy Council (Sarec) chairperson Brenda Martin explained.

“These projects represent a combined value of R50bn in investment into the country that has been put on hold, which is ludicrous when considering our current economic climate,” she said.

However, Zuma said planned investments in renewable energy will go ahead.

“Work is continuing to ensure energy security. Renewable energy forms an important part of our energy mix, which also includes electricity generation from gas, nuclear, solar, wind, hydro and coal,” he said.

“Government is committed to the overall Independent Power Producers Programme and we are expanding the programme to other sources of energy including coal and gas, in addition to renewable energy.

“Eskom will sign the outstanding power purchase agreements for renewable energy in line with the procured rounds.”

Zuma’s utterance comes as the SA Renewable Energy Technology Centre at the Cape Peninsula University of Technology warned this week that the country’s fledgling wind turbine service technician training programme will be “skilling its graduates for unemployment” if construction on the next round of state-commissioned wind farms doesn’t begin within the forthcoming year.

Acting Eskom CEO Matshela Koko told Fin24 this year that renewable energy should be developed at a scale and pace the utility and country can afford – a line first used by Zuma in 2016 to explain the planned nuclear new build plan.

 

Sarec praises Zuma

Martin said on Thursday evening that Sarec is “very pleased to note the presidency’s clear support for the country’s Renewable Energy Procurement Programme (REI4P)”.

“This globally recognised programme was the initiative of government, and it is fitting that the policy-maker’s vision can continue to be realised.

“Industry appreciates the expressed support that key ministers have lent to the REI4P during the year-long impasse with Eskom.

“Some of the serious economic effects of the recent pause in South Africa’s renewable power procurement programme such as factory closures and job losses have caused serious hardship for this fledgling industry. We trust that there will now be rapid movement to resolve the impasse in line with the President’s directive,” said Martin.

“This president’s leadership can ensure that now much-needed direct and indirect investment and job creation is unlocked. More than R57bn investment will flow in the short-term and jobs will be created once outstanding power purchase agreements are signed.

“By 2014, investment into renewables in South Africa accounted for 84% of all foreign direct investment; a total sum of just under R200bn.

“Since 2016, while approximately R57bn worth of further renewable power investment had been secured under the programme in 2015, this sum has not entered the economy. In addition, up to 15 000 jobs associated with the power procured in 2015, are currently not being realised.

She said that through 6 bid windows the REI4P secured the following successes:

  • 102 projects have been procured; investments of R 194.1bn (of which R53.4bn from foreign investors)
  • 64 projects have signed contracts representing 4 006 MW capacity of which 3051 MW was online (including early operation) as at 17 January 2017
  • Substantial jobs for South African citizens have been created (of which more than 47% are for youth)
  • Socio-economic development initiatives have been initiated in local communities
  • A green-industry has started to develop to the point that some manufacturers have become exporters of renewable energy plant components
  • Technicians are being trained at global standard ensuring that young graduates can service both the domestic and international market.

Read the original article on Fin24 by clicking here.

Tshwane announce Embedded Power Generation policy

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The City of Tshwane announced its flagship policy on Embedded Power Generation (EPG), which is aimed to promote small-scale solar power generation by residents.

Speaking at a media briefing on Thursday, executive mayor Solly Msimanga said this is an opportunity for residents to sell their excess power to the city.

EPG is essentially allowing small power generation by residents or small businesses for their own use.

“Residents can generate solar power from a roof-top panel during the day, and sell their excess to the city. At night, when the resident cannot generate solar power, they can purchase from the city,” said Msimanga.

“This is a major step in the renewable power policy and our first step in a real green power development.”

Echoing the mayor’s sentiments, member of the mayoral committee for infrastructure Darryn Moss said the spare electricity generated can be used to make up during instances where the city has a shortfall.

“This innovation mitigates both the economic impact and inconvenience of load-shedding and saves on the cost of buying electricity at peak rates,” Moss said.

Globally, feed-in tariffs have had the biggest impact on the boom in renewable energy.

“Figures provided by the trustworthy Power Quality and Renewable Services indicate that over the course of 2016, it is estimated that 120Mw of actual module sales took place.

“Roughly 118Mw of the total installed capacity has been audited and, due to the volume of data, is assumed to be representative of the growth of PV installations in South Africa over a period of time.

“Strategic decisions have been taken to enhance demand side management through energy-efficiency initiatives, improved metering of electricity and reduced losses from the transmission and distribution of electricity and fuels,” Msimanga said.

The mayor said the production of solar energy within the city is “up there with the best in the country”.

He concluded by saying, together with the EPG, they will ensure the city leads by example by producing energy efficiency plans for households, official buildings and public spaces.

Click here to read the original article from The Citizen.

Eskom can hike prices by 2.2% in 2017 – Nersa

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Pretoria – South Africa’s energy regulator says Eskom can implement a 2.2% tariff increase for the 2017/18 period as part of a previous multi-year increase determination agreement.

Eskom is currently in the last year of what Nersa calls the ‘Third Multi-Year Price Determination (MYPD3)’ which has provided for R205bn allowable revenue for the state-owned power provider in the 2017/18 period.

This revenue is expected to cover all of Eskom’s allowed costs including a return of R33bn. The allowable revenue also includes an amount of R23bn for Independent Power Producer purchases.

Subsequently, Eskom is able to increase tariffs by 2.2% owing to adjustments made in 2015/16 of 12.7% and 9.4% for 2016/17 in line with the power utility’s Regulatory Clearing Account (RCA).

“It’s important to indicate that Nersa did not make any new decisions for Eskom for the 2017/18 period,” said Nersa chair Jacob Modise.

“Nersa did not make any new decisions. This decision was made in February 2013,” said Modise.

However, the National Energy Regulator of South Africa (Nersa) said it is “opening the door” for Eskom to make a new application for a price increase.

Eskom currently cannot apply for a new RCA owing to recent decision by the North Gauteng High Court. The court previously set aside the regulator’s decision to grant Eskom a tariff increase.

But Nersa said that Eskom can still make an application for a price hike if there are any possible cash flow risks for the company.

This application, though, will have to go through a full public participation process.

“To the extent that we have not been able to process new RCA applications.. it is possible that Eskom may be suffering some financial harm,” said Modise.

“We are opening the door to Eskom to make an application,” he said.

Read the original article from Fin24.

China builds world’s biggest solar farm

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High on the Tibetan plateau, a giant poster of the Chinese president, Xi Jinping, guards the entrance to one of the greatest monuments to Beijing’s quest to become a clean energy colossus. To Xi’s right, on the road leading to what is reputedly the biggest solar farm on earth, a billboard greets visitors with the slogan: “Promote green development! Develop clean energy!”

Behind him, a sea of nearly 4m deep blue panels flows towards a spectacular horizon of snow-capped mountains – mile after mile of silicon cells tilting skywards from what was once a barren, wind-swept cattle ranch.

“It’s big! Yeah! Big!” Gu Bin, one of the engineers responsible for building the Longyangxia Dam Solar Park in the western province of Qinghai, enthused with a heavy dose of understatement during a rare tour of the mega-project.

The remote, 27-square-kilometre solar farm tops an ever-expanding roll call of supersized symbols that underline China’s determination to transform itself from climate villain to green superpower.

Built at a cost of about 6bn yuan (£721.3m) and in almost constant expansion since construction began in 2013, Longyangxia now has the capacity to produce a massive 850MW of power – enough to supply up to 200,000 households – and stands on the front line of a global photovoltaic revolution being spearheaded by a country that is also the world’s greatest polluter.

“The development of clean energy is very important if we are to keep the promises made in the Paris agreement,” Xie Xiaoping, the chairman of Huanghe Hydropower Development, the state-run company behind the park, said during an interview at its headquarters in Xining, the provincial capital.

Click here to read the full article from The Gardian.

Medupi power station ready to go

By | Energy Partners in the Press | No Comments

On December 23, 2016, The New Age Online newspaper released an article featuring our spokesperson, Alan Matthews. The article states that the dark days for South Africa’s economy are finally over as the second unit (Unit 5) of Eskom’s new Medupi  power station will be fully operational, suggesting that the local economy is more than ready for this year.

The power utility said that Medupi power station is now closer to commercial operation and this is a significant achievement since its successful synchronisation in September 2016. This will particularly boost heavy industries and small businesses, which were hit hard by load shedding in the past two years, leading to an economic slowdown.

Analysts said this is good news for such a major boost before the start of the new year, and that going forward the country can expect manufacturing and mining output to increase after suffering heavy losses in the last two years.

Medupi power station is a greenfield coal-fired dry-cooled base load station comprising six units rated at 4 800MW installed capacity and it will be the fourth-largest coal-fired plant and the largest dry-cooled power station in the world. Some industry analysts said given the latest improved business leading indicator published by the Reserve Bank this week, which showed economic improvement for the next six months, the synchronisation of 796MW into the grid will boost the country’s energy and ignite the economy.

Phanuel Rapule, an independent economist, said it was evident that SA was becoming more energy efficient and there is no doubt that the local economic growth will somehow improve and consumer confidence will be restored. “Power is the key economic driver anywhere in the world. That means the dark days are over, our local energy problems are vastly disappearing and this could be the start of good things to come,” he said. The South African Chamber of Business (Sacci) also welcomed the move and that business had been proactive in seeking solutions to the energy crisis.

Alan Matthews, spokesperson for Energy Partners, said electricity costs are still on the rise and Energy Partners’ research said there will be above inflation increases in tariffs for at least the next three years. “Consumers must make sure they switch off their appliances while they are away.

Read full article here.