Thread for any info or photos about developments regarding energy in South Africa.

Canadians, M&R get nuclear deal
Aug 22 2008 6:51PM

Toronto - SNC-Lavalin's nuclear power joint venture has won a C$253m (R1.86bn) contract to provide engineering and other services for the second phase of SA's Pebble Bed modular reactor demonstration plant.

The Montreal-based engineering company said on Friday its Murray and Roberts SNC-Lavalin Nuclear group will provide provide engineering, procurement, project and construction management services for phase 2 of the commercial power plant at Koeberg, near Cape Town.

Commissioning of the commercial-scale plant is subject to a nuclear license being issued by the national nuclear regulator and environmental approvals.

The power plant is slated to be completed by September 2014 and is designed to provide about 165 megawatts of electrical power to South Africa's national grid.

- Reuters

'Petrol to drop by R1/litre'
Aug 20 2008 3:39PM

Johannesburg - A "big drop" in the petrol price is expected in September, T-Sec economist Mike Schüssler said on Wednesday.

"I see petrol dropping around R1 per litre - or even more," Schüssler said.

He expected diesel to drop by R1.45 a litre.

However, even if the decrease in the petrol price was as large as expected in September, petrol would still be up 38% compared with a year ago, he added.

He expected petrol to drop month-on-month by 9.6% - the largest month-on-month drop in the last 10-and-a-half years.

Diesel would see a month-on-month drop of 14.1% - the biggest month-on-month decrease in two decades.

The drop in the diesel price would be important for South Africa's economy, Schüssler said.

"We have a lot of land transport here, while the big cities in Europe have waterways."

However, the economy would still feel the high cost of diesel for a few months.

"If the drop in diesel prices is the beginning of a trend, then this would become important for inflation - it would delay second round inflation fears," he said.

As far as the oil price was concerned, Schüssler said there was still a concern that oil prices would rebound in the fourth quarter.

"Winter is coming in the northern hemisphere and the hurricane season only ends in November," he said.

The world still had tight supply-demand ratios and politics in the Middle East could affect oil prices.

Oil was one of the most difficult commodities to price this year, he added.

"Depending on the demand-supply situation, I see oil at between $80 to $125 at the end of this year," Schüssler said.

- Sapa

Tongaat Hulett could spend up to R7bn on cogen projects
By: Matthew Hill
Published: 15 Aug 08 - 0:00

Agroprocessing firm Tongaat Hulett could generate up to 266 MW of power within three years if it decided to build cogeneration plants at four of its Southern African sugar mills.

It said this is against the background of predictions that electricity demand in South Africa will exceed generating capacity for a five to seven year period.

South Africa's sugar industry is one of the most promising solutions to the country's power crisis.

Tongaat CEO Peter Staude has previously said that South Africa's sugar industry has the potential to generate nearly 4% of the country's power demand. The cost of this power would also be cheaper than several alternatives - including gas-powered generators and wind power. Staude says that power produced by sugar is similar in cost to new coal-based power stations.

Electricity is produced by burning the part of the sugar cane that is not used to produce sugar.

Tongaat Hullet generates its own electricity and supplies excess power to the eThekwini municipality. However, if it received the right price and made the necessary investments, it could increase its supply by a multiple.

Staude said that Eskom had a process in place to purchase electricity from private producers such as Tongaat Hulett.

All four projects were either in pre-engineering or environmental-impact assessment stages, CEO Peter Staude stated.

The company still had to decide whether to build the generation plants using technology that would allow it to burn tops and trash, which was the main factor determining how much electricity it would produce.

If Tongaat Hulett decided to go with the tops-and-trash technology, it would be able to build 266 MW of power generation capacity in about three years.

If it chose not to, then it would be able to commission 108 MW of in-season capacity within 30 months, Staude said in a telephone interview.

Asked the sort of price tag the company was expecting it would have to pay for these projects, he said that it would cost in the region of R26-million for each megawatt of installed capacity.

This would amount to nearly R7-billion for 266 MW, or R2,8-billion for 108 MW.

“We’ve got four sugar mills that lie in deficit areas,” Staude said, explaining that power had to be imported from other areas to feed these plants.

Three of these were on the KwaZulu-Natal North Coast region, which received power from Mpumalanga, with one in Mozambique, at Xinavane, near to BHP Billiton’s power-guzzling Mozal aluminium smelter.

Staude had earlier this year said that he would be “sur-prised” if a cogeneration deal was not struck between his com-pany and State-owned Eskom during this year.

Meanwhile, Tongaat Hulett reported a 44% increase in operating profit for the six months ended June 30, to R443-million. This was on the back of more competitive South African maize prices, which boosted the group’s starch operations.

Staude said that growth in Tongaat Hulett’s profit for the full year would not be as strong as in the first six months. The company had also posted good results for the second half of 2007, he said.

I heard Government is allowing private investors to build Power stations in which they will buy power from them but I think ultimatly they will buy the station & have Eskom run it.

Eskom applies for new Limpopo pumped-storage scheme licence

By: Chanel Pringle
12 Dec 08

State-owned Eskom has applied to the National Energy Regulator of South Africa (Nersa) for a licence to operate its planned 1 520-MW Tubatse pumped-storage scheme in Limpopo province.

The R19-billion project, formerly called project Lima, would be situated near Roossenekal, between the Nebo plateau and the Steelpoort river valley, with the first of four 375-MW units expected to come on stream by 2014.

All four units would be operational by early 2015.

All interested parties would have 14 days to lodge any objections regarding the project with Nersa.

This would be the utility's second pumped-storage scheme and would follow on the construction of the R9-billion Ingula project, in the Drakensberg mountain range between the Free State and KwaZulu-Natal, which would be completed by 2012.

Eskom noted in its licence application that the initial filling of the scheme would take place through a pipeline from the De Hoop dam, which formed part of the second phase of the Olifants River Water Resource Development project (ORWRDP), to a lower reservoir between December 2012 and December 2013.

The utility was negotiating a 40-year contract with the Department of Water Affairs and Forestry (Dwaf) for the supply of the initial fill water, estimated to be about 16-million cubic metres and make-up water of about one-million cubic metres a year to make up for evaporation losses.

The exact volumes of water required for the project would, however, still be determined when the detailed design is completed.

Dwaf would supply the initial charge of water and the annual make-up water, while also doing the maintenance on the pipeline, which it would own and construct by October 2012.

Eskom would, in turn, as part of Dwaf's ORWRDP plans, supply water to about 800 000 people on the Nebo plateau in the Greater Sekhukhune district municipality.

The utility noted that the average pumped-storage scheme had a life in excess of 70 years.

Further, Eskom said in its licence application that the funding programme for the project was under review and that it was discussing funding with "key stakeholders".

I heard Government is allowing private investors to build Power stations in which they will buy power from them but I think ultimatly they will buy the station & have Eskom run it.

They probably looking to follow the Build Operate Transfer (BOT) model which is fast becoming very popular in African governments as a model to develop critical infrastructure in energy, transport and water sectors.

Renewable energy feed-in tariff may be approved in March

By: Christy van der Merwe
05 Jan 09

The National Energy Regulator of South Africa (Nersa) hopes to finally approve the long-awaited renewable energy feed-in tariff (Refit), aimed at stimulating investment in the sector, on March 9.

Nersa has requested comments on the Refit consultation paper, which it released in December, to be submitted by January 15.

The agency would hold public hearings on February 5 at the Nersa auditorium in Pretoria.

Nersa regulator member for electricity Thembani Bukula previously stated that the agency would announce the final Refit in February 2009, after it was initially expected in September 2008.

Owing to the more expensive cost of generating electricity from renewable energy sources such as wind, sun and natural gas, feed-in tariffs were seen as a structure to stimulate large-scale investment in the renewable energy sector.

The Refit would not lower the cost of electricity for the customer, but would subsidise renewable energy generators. The tariff was expected to cover the cost of generation, plus a fair return for investors.

“The model calculates the subsidy amount as the difference between the feed-in tariff provided, and the avoided cost of power generation. This gives an indication of the additional costs to the consumer of the tariff programme,” indicated Nersa.

The model also allowed for the inclusion of carbon revenue through the Clean Development Mechanism.

The tariff schedule for 2008 to 2013 as setout in the consultation paper would be as follows: wind power 65,48c/kWh in 2008, steadily decreasing by 2,45% a year to 57,84c/kWh in 2013; hydro-power 73,76c/kWh in 2008, decreasing 0,57% a year to 71,69c/kWh in 2013; landfill gas, 43,21c/kWh in 2008, decreasing 1,16% a year to 40,75c/kWh in 2013; concentrating solar, 60,64c/kWh in 2008, lowered by 1% a year to 57,67c/kWh in 2013.

Eskom Distribution would be appointed the renewable energy purchasing agency, with the responsibility of the regulator limited to overall monitoring and review.

However, some stakeholders felt that the Nersa Refit, as put forward in the consultation paper, was not likely to attract much serious foreign direct investment, despite South Africa’s abundance of natural resources for renewable energy generation.

“We have called on Nersa to reconsider their proposal and call for the tabling of an improved proposal, as soon as possible. We hope to see a stronger proposal that provides for an independent renewable energy purchasing agency, and a more cost responsive way of setting tariffs,” WWF climate change programme manager Richard Worthington stated.

A number of civil society renewable energy stakeholders would convene to draw up and submit “detailed, coordinated comment at the very tight deadlines set by Nersa, because we hope to have an effective arrangement in place by the end of February, as promised”, added Worthington.

The Department of Minerals and Energy (DME) recently confirmed that it had received more than 100 renewable-energy project proposals, involving as much as 5 000 MW of potential generation capacity.

Some 45% of the applications related to wind energy, 34% to biomass projects and 8% to small-scale hydro schemes.

Acceptable technologies
For the purposes of tariff setting, Nersa said that acceptable renewable energy technologies were the more well-known categories of wind, hydro, landfill gas, and concentrating solar.

“There are arguments for the inclusion of a wider set of technologies (such as solar photo-voltaics and wave-power), however, these other technologies are unlikely to be cost competitive against the current set supported,” Nersa said.

The period of feed-in tariff support would be 15 years, to 2022.

“The 15-year period appears to be a sensible approach based on international experience and based on the financing requirements of local projects. Most local projects are unlikely to have project financing structured with loans with a tenor greater than 15 years and hence the defined period offers sufficient financial stability to allow developers to secure project finance,” the regulator stated.

The tariffs for the initial Refit programme were established through the development of a spreadsheet-based tariff model that is used for analysing and quantifying the key policy framework decisions. Nersa explained that the key data input for the feed-in tariff was based largely on the Department of Minerals and Energy’s (DME’s) Macro Economic Study on renewable energy supply from 2004.

“The model has been structured as a least-cost model to meet a user-specified renewable energy target for 2013,” said Nersa. This target, set out by the DME was 10 000 GWh by 2013.

Source (http://www.busrep.co.za/index.php?fArticleId=4790497)

SA's next nuclear power plant to come on stream by 2019

January 13, 2009

By Agnieszka Flak

Johannesburg - South Africa expects its next nuclear power plant to come on stream by 2019, two years later than initially planned by Eskom, which has dropped plans to build the facility due to financial woes.

While Eskom was hoping nuclear energy would supply one quarter or 20 000 megawatts of South Africa's expanded generating capacity by 2025, the government says a target of 6 000MW in the same period is more feasible.

South Africa will have to keep reverting to more coal to supply its growing demand in the meantime.

Nelisiwe Magubane, the deputy director-general at the minerals and energy department, said: "We appreciate what Eskom had as a plan, but we need to be practical and see what can be done in that time: 6 000MW seems much more feasible."

South Africa's power utility operates Africa's sole nuclear power plant, Koeberg, with a total capacity of 1 800MW. Magubane added that an additional 3 200MW of the planned 6 000MW was due in 2019.

The government, which took over after Eskom bowed out, said that the two-year delay was needed to properly initiate the process.

Some experts said the government could have helped Eskom raise funding for the nuclear project through debt guarantees.

But Magubane said the government wanted to launch a process that differed from the utility's one-time proposal to ensure it could build up the fleet over time.

The Central Energy Fund (CEF) of South Africa has announced a drive to install solar-powered traffic lights at critical intersections in South Africa’s major cities. The CEF foresaw an investment of R 100 million and installations at 400 intersections. This was justified by “Quantified in monetary terms, productivity losses, accidents at uncontrolled intersections, and exhaust emissions from stationary motor vehicles all have an adverse effect on the economy,”

Traffic studies show that at normal traffic speed reductions in the average trip speed increases the petrol consumption significantly - for example reducing average trip speed from 30 km/h to 10 km/h almost doubles the average petrol consumption.

In a back-of-the-envelope calculation, if we assume 15% of all travel is for commuting, that 5 percent of this is effected by rolling blackouts and that average speed of the congested traffic is a high 10 km/h, the cost of the extra fuel used is R 1.3 billion a year and the additional carbon dioxide generated is 400 000 tons.

Similar calculations looking at the cost of lost time give even higher figures but are not always accepted as its the worker who suffers from a longer commute time and not the employer. However, some employers in Johannesburg have been keen to sponsor solar powered traffic lights near their offices to ease the flow of traffic to get their employees to work on time.

What is the Bigger Picture?
Eskom (the national, government-owned electricity generator) has experienced a drop in electricity demand recently as a result of the worldwide economic situation. This has caused concern that renewable energy technology will receive less investment and that the drop in price of fossil fuels will effect their viability.

However, cable theft and the effect of heavy sub tropical rainstorms are additional motivators for solar traffic lights. It is also expected that as the economy recovers rolling blackouts will once more be used to balance supply while the need to assure a successful 2010 is a strong motivator for infrastructure investment. Imagine the stadium lights going out in the final - so African!

Testing of a pilot installation by the National Energy Efficiency Agency has proven the feasibility of solar traffic lights in South Africa’s environment. The fact that most rolling blackouts take place during the day suits solar power’s output, while the installation of uninterruptible power supplies and the replacement of old lights with LEDs by a number of municipalities simplify installations.

Where Are We Today?
The current situation seems to be that not many more than 20 have been installed, that these have cost about R 300 000 each but that, for example, Johannesburg has identified 400 intersections requiring lights for which the are seeking public/private investment.

It is hoped that this initiative is continued so that we are not once again announcing and planning a solution when we are already in the middle of the problem.

http://ecoworldly.com/2009/02/11/what-makes-solar-powered-robots-traffic-lights-stop-lights-viable-in-south-africa/

Irish firm in SA wind farm venture

19 March 2009

Irish company Mainstream Renewable Power has signed a €850-million (about R11-billion) joint venture deal with South African firm Genesis Eco-Energy to build wind farms to generate "an initial pipeline" of over 500 MW of energy in the Eastern, Northern and Western Cape provinces by 2014.

The joint venture company plans to have two projects - a 30 MW wind farm at Jeffrey's Bay near Port Elizabeth, and a 40 MW project at Colesberg in the Northern Cape - ready for construction early in 2010.

The two projects "are both at advanced development stages and are expected to be fully operational early in 2011," Mainstream said in a statement on Thursday.

"Wind energy is very much an untapped resource in South Africa, and this is a huge opportunity for us," said Mainstream chief executive Eddie O'Connor.

A shortage of power generating capacity is constraining South Africa's economic growth, and state electricity company Eskom is to spend hundreds of billions of rands over the next five years on increasing this capacity.

At the same time, the government is placing increasing emphasis on reducing South Africa's dependence on fossil fuels. Speaking at a renewable energy conference in Pretoria on Thursday, Minerals and Energy Minister Buyelwa Sonjica said the government wanted renewable energy to account for between 6% and 9% of electricity generated in the country by 2013, and between 9% and 15% by 2018.

Mainstream's O'Connor said that while there was currently less than 10 MW of wind energy in operation in South Africa, with the country's "excellent wind resource there's the potential for many thousands.

"We are confident that the South African government will shortly implement appropriate policies to kick-start and support the wind energy market," O'Connor added.

Genesis Eco-Energy's director of operations, Davin Chown said that Mainstream's investment was "a vote of confidence in both the Genesis team as well as the emerging renewable energy market in South Africa, which holds significant potential for an investment and development partnership such as ours."

Besides contributing to South Africa's climate change mitigation strategy, the new projects will give a major boost to local economic development, energy security and job creation.

Mainstream is also engaged in development projects in the US, UK, Canada, Chile and Germany. Earlier this month, the company signed a CAD$840-million deal to build wind farms in Canada, and in February it won the right to develop a £1.1-billion offshore wind farm off Scotland.

SAinfo reporter

New wind-energy partnership sets sights on 500-MW in SA by 2014

By: Terence Creamer
19th March 2009

A newly formed South African-European renewable-energy joint venture announced plans on Thursday for the development of 500 MW of wind-energy capacity in South Africa by 2014, and revealed that its first 30-MW venture would be “construction ready” by early 2010.

The joint venture comprises Irish wind-energy developer Mainstream Renewable Power, which will hold 85% of the new venture, and Genesis Eco-Energy, of South Africa.

Mainstream, which has a growing international project pipeline spanning four continents, would lend its experience, capital and fundraising muscle to the alliance, while Genesis would inject its local knowledge and an emerging portfolio of prospects in the Western, Eastern and Northern Cape provinces.

Mainstream’s chief development officer Torben Andersen said that the South African projects would be financed through a combination of equity and debt.

He added that he remained confident that there was sufficient appetite from domestic and foreign banks to enable an 80:20 debt-to-equity split, despite the credit crisis.

But the South African projects would hinge materially on the outcome of the National Energy Regulator of South Africa’s (Nersa’s) deliberations regarding a so-called renewable energy feed-in tariff, or Refit – a decision on which was due by the end of the month.

The joint venture had made a submission to Nersa indicating that wind-energy projects would require the Refit to be set at around R1/kWh, as opposed to the 65c/kWh proposed in Nersa’s consultation paper.

“We believe that the level proposed by the regulator was based on outdated capital-cost figures for the industry and we are hopeful that the final tariff will be adjusted to reflect current realities,” Genesis Eco-Energy’s Davin Chown said at a media briefing in Johannesburg.

Nersa, which was initially expected to make its Refit determination on March 9, was currently expected to make its adjudication on March 30.

The tariff structure was being pursued in support of government’s target of having 10 000 GWh of renewable energy projects in place by 2013.

Andersen asserted that, while wind would require a higher tariff than a coal-fired station, its inclusion into South Africa’s energy mix would also lower the overall risk associated with primary-energy price volatility. It would also reduce the need for peaking capacity, which was about three times more expensive than its R1/kWh proposal.

However, he cautioned that if the Refit was set at too high a level it would also encourage suboptimal wind projects on sites where the wind resource blew at a rate of lower than 7 m/s.

Mainstream was pursuing similar roll-outs in other regions of strong demand and policy support. It had already raised R1,27-billion in equity and mezzanine finance, including R260-million from Barclays Capital, which had taken a 14,6% position in the company. It had also recently concluded a R9,9-billion joint venture to build a 400-MW portfolio in Chile; a R6,6-billion joint venture deal in Alberta, Canada to build over 400 MW of wind energy by 2013; and had been awarded the exclusive right to develop a R13-billion offshore wind farm in Scottish territorial waters, with a potential capacity of 360 MW.

JEFFREY’S BAY LIKELY TO HOST FIRST R600M PROJECT
Chown indicated that its most advanced project was its R600-million, 30-MW prospect on a dairy farm near Jeffrey’s Bay, in the Eastern Cape, which was due to receive its environmental approval soon.

He said that the project was scheduled to move into the construction phase early in 2010, with commissioning planned for late 2011.

An analysis of the site and its wind map indicated that it would be able to deliver into the grid at a consistent average of 10 MW as measured over a period of a year.

Genesis was also pursuing a 50-MW project in the Southern Cape, a 65-MW facility in Lambert’s Bay and was optimistic of reaching an agreement with local communities and landowners in the St Helena Bay area.

In many instances, the wind facilities would coexist with farming activities, with farmers benefiting from long-term lease agreements.

The joint venture planned to employ proven turbine technology, with nameplate capacities of between 2 MW and 2,5-MW, which it would secure from established vendors such as General Electric, Siemens and Vestas.

It was also not overly concerned about the single-buyer model that had been proposed by government, whereby Eskom would establish power purchase agreements with all independent power producers, including renewable suppliers.

Further, Andersen was unfazed by the prospect of Eskom upscaling its involvement in wind through the development of a 100-MW wind farm, saying it would provide the utility with a deeper insight into wind as an energy technology.

“There are a lot of benefits that could arise from having the main operator of the grid understanding the operation of a wind farm,” Andersen averred, adding that he was in favour of the creation of both the market for wind energy, and for that market to be competitive.

SA to get third wind farm
Wednesday, 25 March 2009
South Africa’s investments into renewable energy are picking up speed as an environmental impact study for the country’s third wind farm gets underway in St Helena Bay this month.

The first wind farm in South Africa, the R75-million Darling wind farm, was powered up in May 2008 with four turbines, each of which generate 1.3 MW each of clean energy.

Eskom recently confirmed that they would be going ahead with the proposed Koekenaap facility. Construction is set to begin later this year with the 100 MW plant set to be operational by 2010.

With a budget of R850-million the planned St Helena Bay Wind Farm will be a large-scale renewable energy plant, with the capacity to produce at least 50 MW of power - or up to 2% of the entire Western Cape province's 3 500 MW summer requirements. Energy generated by the wind farm will be fed into the national grid.

The project is a collaborative effort between the Western Cape Department of Environmental Affairs and Development Planning, the Saldanha Municipality, Oxfam UK and Genesis Eco-Energy (a Cape based energy company) and the Seeland Development Trust.

The 926 hectare piece of land earmarked for the St Helena Bay wing farm is owned by the poor fishing community of Seeland, who acquired it through the government's Land Redistribution for Agricultural Development Programme.

A group of more than 200 emerging farmers from the community have joined to form the Seeland Development Trust, which is now a 25% owner in the wind farm project. All revenue will go towards social and economic development projects to benefit communities in the area.

Source: SAGN/mediaclubsouthafrica

Went to Decorex and I saw a company that supplies wind turbines for businesses. They freeken expensive tho, 1.8mill for 1, but they pretty effective.

One of my best mates is finishing up his masters in Renewable Energy at UCT, and has just got onto Vestas' grad scheme. Vestas are the largest wind turbine manufacturers in the world, and he's busy conducting his thesis on the viability of financing wind farm projects here in SA. Problem with lot of the proposed ideas (for example one of the farms that went up on the west coast) is that while a site may have sufficient wind (usually sustained winds of 60kph reqd.), the vicinity of the site to the power grid is not ideal. Not clued up on the specifics but the crux is that the further away from the grid the site is, the more (resistance?) energy is lost getting to the grid.

Then, there's the issue in SA at present: basically once you're connected to the grid you sell your energy to Eskom. Thing is Eskom currently will offer to buy electricity from the wind farms (particularly that west coast community's one) at a rate that exceeds the long term financing of the project (i.e. the electricity will be sold at a loss).

Wind turbines can however be great for 'localised' power provision. I lived in Vail, Colorado for a while and the entire ski resort there is powered by wind. I also worked for BP in London and a lot of our work involved logistics out of Rotterdam port; which has wind turbines at the harbour. These contribute towards powering the port (one of the world's largest) and obviously save the port shiploads of money ;)

I wonder whether it would be viable to set up some turbines on the bluff to power Durban's port. They don't take up much ground area, and I know I'm going to get some people saying that it would make the Bluff look ugly, but I dunno if I'd tend to agree with that: I travelled in Italy last year and while on a train to Genoa we went past a number of turbines dotted on the green hilltops and I must say it was absolutely beautiful watching them slowly turning as we moved past. If aesthetics was too big an issue I guess they could test if they'd be viable at the south side of the harbour entrance by those concrete whatsenames that calm the sea... though that might be a bit close to the new point area, and the higher up the better for wind I think.

we have one planned for the farm in Paarl which will power all the irrigation as well as 80% of the annual domesitc supply for the house and its a big one at 12m and 1kw

Its only around R50k instauled ex turbine factory in PE

Wind energy is great for the feel good thing about the environment. But to supply adequate power to industry and all the growing households, only three methods are viable in SA. Nuclear, Hydro or Coal. Anything else will be minute.

Very much so, and the sooner we get another nuclear power plant in tow, the better.

We really should be making more use of nuclear energy.

damn, i'm so upset, i forgot all about earth hour an saturday night, was busy watching top gear extra...go figure
anyway, sorry world, sorry cape town, i did not switch off for an hour
(i did go camping on the friday night though, so no lights were on for a WHOLE night on friday at my home)

SA firm plans R250m biodiesel plant

By: Chanel Pringle
30th March 2009

South African biodiesel production company First In Spec BioDiesel was planning to build a R250-million biodiesel plant that would convert waste vegetable oil into biodiesel, a company official said on Monday.

MD Louis Nyiri told delegates at the African biofuels conference, in Midrand, on Monday, that it was planning to build a plant to produce 50-million litres a year of biodiesel.

The company had already signed letters of intent for about 15-million litres a year of feedstock from companies abroad, as it would be cheaper to import the feedstock from foreign countries.

The plant would require between three-million and four-million litres a month of feedstock, he said.

Nyiri noted that the company could bring R50-million in equity to the table and was looking to acquire funding for the rest of the project costs.

He added that if biofuels project developers had a good plan, they stood a good chance of obtaining funding, even in economically difficult times. Bringing in more parties to share the debt would also likely make it easier to obtain financing, said Nyiri.

New wind farm for Western Cape
24 March 2009
Janine Erasmus

http://www.mediaclubsouthafrica.com/images/stories/march2009/turbines-text.jpg
http://www.mediaclubsouthafrica.com/images/stories/march2009/how_wind_turbine_works-text.jpg


An environmental impact study for South Africa's third wind farm is due to begin before the end of March. The planned St Helena Bay wind farm on the country's west coast will run between 18 and 20 wind turbines, producing at least 50 MW of power - or up to 2% of the entire Western Cape province's 3 500 MW summer requirements.

The first wind farm in South Africa, the R75-million ($8-million) Darling wind farm, powered up in May 2008 with four turbines, each of which generate 1.3 MW each of clean energy. Partners include the Western Cape Department of Environmental Affairs and Development Planning, the Saldanha Municipality on the west coast, the Seeland Development Trust, Oxfam UK and project developer Genesis Eco-Energy.

The 926 hectare piece of land earmarked for the St Helena Bay wind farm is owned by the poor fishing community of Seeland, who acquired it through the government's Land Redistribution for Agricultural Development programme.

A group of more than 200 emerging farmers from the community have joined to form the Seeland Development Trust, which is now a 25% owner in the wind farm project. All revenue will go towards social and economic development projects to benefit communities in the area.
Blowing in the wind

St Helena Bay is a windy area that is particularly suited to this type of project, as wind speeds of six metres per second and more are the rule rather than the exception.

Energy generated will be fed into the national grid. The National Energy Regulator of South Africa will announce its decision on the implementation of renewable energy feed-in tariffs at the end of March 2009. This is expected to stimulate large-scale investment in renewable energy in South Africa, as the tariff will amply cover the cost of generation and investors can anticipate a reasonable profit too.

The number of turbines has yet to be confirmed, as this will depend on the wind situation in the area as well as issues to be examined in the forthcoming study, such as visual impact. The project is expected to create about 25 permanent jobs.

Genesis Eco-Energy operations director Davin Chown explained that the international financial crisis has caused the cancellation of a number of European renewable wind energy projects, leaving manufacturers with surplus stock. Speedy importation of turbines into South Africa will therefore not be a problem.

With a budget of R850-million ($89-million), the new wind farm at St Helena Bay will be the third large-scale renewable energy plant in the country, after Darling and the proposed Eskom facility at Koekenaap near Vredendal in the Western Cape.

The latter project was confirmed by Eskom, South Africa's national power supplier, in January 2009, and the first phase will see about 50 turbines producing 100 MW, with phase two introducing a similar number. Construction will begin later in 2009 and the plant is expected to be operational by 2010. Eskom is building the farm in partnership with French development agency Agence Française de Développement.
Ideal for wind power

Because of the consistency and force of its winds, South Africa's west coast has been identified as a perfect area for generation of electricity through wind. However, experts say that lack of a comprehensive and accurate map of windy areas is hindering development. It is vital to know where the best areas for wind turbines are, in order to plan ahead.

In January 2009 work started on a four-year project to plot wind speeds and frequencies along the 3 000km west coastline. Sponsored in part by the Danish government, the wind atlas will provide detailed information about local wind conditions and thus encourage renewable energy investment in the area.

The study is being conducted jointly by Cape Town University, the Royal Danish National Wind Resource Institute, the South African National Energy Research Institute and the Department of Minerals and Energy. The first draft map is expected by early 2010.

Denmark is the world's leader in wind power, deriving more than 19% of its power from the breezes that gust across the land.

Lights off after 7pm!

City's imaginative answer to climate change lauded

April 01, 2009 Edition 2

Natasha Joseph

INSPIRED by the success of Saturday's Earth Hour initiative, the City of Cape Town has come up with what a top international scientist has called "a cutting edge and world-class solution to the problem of climate change" - household electricity supplies are to be limited every second evening.

And office blocks and factories across the city will have their electricity switched off after 7pm every second day.

Households will be supplied with enough electricity "to power lights, a four-plate stove and a microwave".

The bold new plan will be implemented from May 1 this year.

In a statement released yesterday, Cape Town's utility services directorate acknowledged its plan "may cause some distress (among residents) at first", but said it would engage in "public education drives designed to educate people about how much damage excessive electricity output is doing to the city and the planet".

In its statement, the city said it had started discussing this idea late last year, but had "expedited the process" after noting the success of this year's Earth Hour campaign.

The Cape Times reported on Monday that Earth Hour resulted in a 15 percent reduction in South Africa's lighting consumption.

Outlining its plan in the statement, the City of Cape Town said it would dispatch teams from its utility services directorate to all parts of the city to find out which buildings were being used as office blocks and which were residential. Once this had been done, technicians would replot the city's electricity grid.

"We decided 7pm was a good switch-off time as by then, people will have finished work for the day."

Asked if the city had considered night shift workers and businesses operating at unusual hours, a city spokesperson said exemptions would be granted. The Cape Town Regional Chamber of Commerce and Industry could not be reached for comment.

While the new plan may shock Cape Town businesses and residents, climate change scientists are thrilled. Speaking from the World Wide Fund for Nature's Copenhagen offices, Danish scientist Olaf Priol, who is considered one of the top minds in climate change science, said he was "ecstatic" that Cape Town was adopting "such a bold, incredible plan".

"This is a cutting edge, world-class solution to the problem of climate change," Priol said. "Cutting back an entire city's electricity consumption will make a meaningful contribution to mending damage already done. I hope other cities all over the world follow suit."

natasha.joseph@inl.co.za

Happy April fool Mo.....

Happy April fool Mo.....

haha fooled! Brilliant!

Cut at source by SA team
Two companies are piloting a technology developed by a team of Wits University scientists to reduce CO² produced in their chemical processes.
Sasha Planting
Two companies, one based in China and the other in Australia, are piloting a technology developed by a team of Wits University scientists to reduce CO² produced in their chemical processes.
Linc Energy and Golden Nest International specialise in converting coal into liquids, notably diesel fuel. Both companies have reported positive results from the pilots.
The logic of the Wits scientific team was simple: it is easier to reduce carbon emissions before they are produced by changing the existing process so that emissions are reduced at the source.
“The current approach is to fix the problem after you’ve made it. We are saying, don’t make it in the first place,” says research programme manager Brendon Hausberger at the Wits Centre of Materials & Process Synthesis.
Take, for example, a coal-to-liquid plant, says centre director Diane Hildebrandt. “Instead of using carbon monoxide and hydrogen as intermediates in the process . one can reduce emissions by using carbon dioxide and hydrogen as intermediates in the process.”
The world’s largest coal-to-liquid company, Sasol, has not expressed any interest. “The foreign market has been quicker to pick it up,” she says.
Aside from emissions reductions, results from the pilot tests indicate that by implementing the new process, companies can generate savings of 20%-30% on capital invested in the plant and 10% 20% savings on operating costs.
The scientists, along with Wits University, are to establish a company to commercialise their breakthrough technology.

2010: SA's neighbours to help
27/04/2009 17:00 - (SA)

Johannesburg - Various Southern African countries will assist with ensuring an adequate power supply for the 2010 Soccer World Cup, said Eskom on Monday.

"The Southern African Power Pool (SAPP) today pledged to support South Africa... in areas of generation, transmission, customer contributions and demand side management initiatives at a meeting that took place in Maputo, Mozambique."

Countries that make up the SAPP include Angola, Botswana, the Democratic Republic of Congo, Malawi, Mozambique, Namibia, Swaziland, Tanzania, Zambia and Zimbabwe.

Eskom said this support would help ensure a reliable electricity supply during the 2009 Confederations Cup and the 2010 FIFA Soccer World Cup.

Commercial agreements would be negotiated and signed separately between the various SAPP members and Eskom.

A targeted amount of the power supplied would be "green power".

Eskom Project 2010 unit managing director Johnny Dladla said the power utility was delighted with the SAPP counterparts' commitment.

"This initiative confirms that the 2010 FIFA World Cup is truly and indeed an African event," said Dladla.

- SAPA

Power stations set for commissioning target

Power utility Eskom reports that, to date, its Medupi and Kusile power stations are on schedule to meet their commissioning target dates in 2012 and 2013 respectively.

Medupi, situated in Lephalale, in the Limpopo province, comprises six units with a total installed capacity of 4 800 MW and, once complete, will be the fourth largest coal-fired plant and the biggest dry-cooled power station in the world.

Construction started in May 2007 and the first unit is planned for commissioning by April 2012, with the rest of the units following at about eight-monthly intervals.

Eskom says that the Medupi project will include a super critical boiler plant, which is able to operate at higher temperatures and pressures than previous generation boilers, and, most importantly, operate with greater efficiency. The supercritical design is a first for the utility, and the higher efficiency will result in better use of natural resources, such as water and coal, and improve environmental performance.

The utility reports that an immanent milestone for Medupi is the signing of the water treatment plant contract. This contract will be one of the largest of its kind to be signed by Eskom, while the boiler and turbine contracts for Medupi are the largest contracts that the utility has signed in its 86-year history.

Community Upliftment
Eskom comments that the construction of the Medupi power station will have a significant effect on the lives and the economy of the small community of Lephalale. Houses and a social infrastructure are planned to be developed to serve the thousands of contractors working on site. Job creation will peak at 8 000 direct jobs during construction.

Lephalale's gross domestic product (GDP) is expected to increase by about 95% a year as a result of the power station construction activities, with about 40% of the project cost spent locally. In addition, the power station will directly grow South Africa's GDP by 0,35% a year.

Eskom comments that challenges on the horizon at Medupi are the shortage of housing and support infrastructure in Lephalale, as well as the building up of stakeholder relationships, which are of paramount importance. The signing of the Project Labour Agreement, the first of its kind, will help in resolving industrial disputes at the Medupi project.

Environmental Focus
Eskom reports that the Medupi Environmental Monitoring Committee continues to carry out its work. Environmental education also forms an integral part of the project and local people are constantly given information about fauna and flora on site, as well as the environmental effects of the construction.

The utility works in close collaboration with environmental organisations to ensure that no unnecessary harm is caused to the fauna and flora in the construction areas. During the clearing of the Medupi site of some 840 ha, many protected trees were either replanted or transported to a special nursery at the adjacent Matimba power station. Additionally, about 20 animal species were relocated to a nearby Eskom game reserve. Game animals included impala, two nyala, a gemsbok, eland and kudu. A local professional snake catcher is relocating all snakes found on site and is also using the opportunity to educate workers on the site about reptiles.

The clearing of such a huge area involves massive amounts of vegetation and topsoil. This was preserved for rehabilitation of the existing Matimba power station ash dump and possibly some of the Grootegeluk mine tailings dumps.

Kusile Power Station
Kusile, near Witbank, is the utility's second most advanced coal-fired power plant project besides Medupi. The station comprises six units, each rated at about 800 MW installed capacity, providing a total of 4 800 MW. Once finished, this will be one of the largest coal-fired power stations in the world.

The first unit at Kusile is planned for commercial operation in 2013 and the other units will follow at about nine-month intervals, with the last unit expected to be in operation by 2017.

Eskom reports that the terracing work at the construction site at Kusile is in progress, and the main work started in February 2009. The current contractor on site, Roshcon, is working around the clock to ensure that terracing is completed on schedule.

Other main contractors moving on site during 2009 are boiler contract recipient company Hitachi Power Africa and turbine island manufacturers Alstom S&E.

Kusile will be the first power station in South Africa to have flue gas desulphurisation (FGD) installed. Eskom explains that FGD is the technology used to remove oxides of sulphur, such as sulphur dioxide, from the exhaust flue gases in power plants that burn coal or oil.

Eskom says that it is fitting FGD to the Kusile plant as an atmospheric emission abatement technology, in line with current international practice, to ensure compliance with air quality standards, especially since the power station is located in a priority airshed area. The FGD plant is a totally integrated chemical plant using limestone as feedstock and producing gypsum as a by-product that can be used in the manufacture of dry walls and ceilings.

Job Creation
The Kusile project is expected to create over 7 000 direct construction jobs at the project's peak, with an estimated 5 000 indirect employment opportunities. Many residents from the neighbouring towns, such as Witbank, Delmas and Ogies, have been employed.

The project will develop skills such as pipefitting, welding and boiler making as well as provide training for technicians, and riggers, among others. Local businesses, from the hospitality industry and catering to construction and material supplies, are also benefiting from the project.

http://engineeringnews.co.za/article/power-stations-on-schedule-2009-04-17

New transmission line boosts SA grid options

Power utility Eskom tells Engineering News that its new 765-kV line from Mercury substation, near Orkney, to Perseus substation, near Dealeville, is almost complete with only a few kilometres left to construct.

This is the first line to be strung among a number of other projects associated with the Zeus to Omega Scheme aimed at strengthening the Cape corridor over the next few years. The aim of the scheme is to ensure stable electricity supply in the Cape, while adding transmission capacity to cope with predicted load growth.

The Mercury to Perseus line has been handed over to the grid, with the exception of two outstanding towers. Eskom reports that activities are on schedule for the line construction from the Hydra substation, near De Aar, to Gamma substation, near Hutchinson. The line from Gamma to Omega substation, near Koeberg power station, has been deferred to 2010.

Eskom also reports that its 765-kV line from Zeus substation, near Standerton, to Majuba substation, near Amersfoot, is also progressing well.

On the Majuba substation to Mfolozi Section A, near Ulundi, the progress has been very slow owing to heavy rains on site, but the utility says that transmission line stringing will continue soon, if the weather permits.

Section B of the Majuba to Mfolozi line has also been affected by heavy rains resulting in slow progress, but the replacement plates for the 701C tower are due to arrive in early April and installation will follow. Stringing will begin as soon as the weather permits.

The Perseus to Hydra tender evaluation is under way and all activities between Hydra and Gamma are progressing as scheduled.

The Mercury to Perseus project has contributed to the surrounding communities in line with the Accelerated and Shared Growth Initiative for South Africa by providing jobs and training. The utility says that this will boost the economic stability of the area. In addition, the project has contributed over R49-million to the areas of Klerksdorp, Potchefstroom, Welkom and Bloemfontein through the procurement of cement, sand and other material, as well as the hire of equipment.

The utility comments that it is grateful to its partnership with the principal contractor and their subcontractors for contributing to the corporate social investment initiatives in the various areas affected by the project. The contribution is in the form of soccer fields and nets, palisade fencing around schools, mobile libraries, school furniture, school halls, frames, wheelchairs, and learners' school packs.

Arnot Power Station Capacity Increase
Arnot power station, one of South Africa's oldest power stations, is undergoing an extensive R1,48-billion refurbishment to meet increasing demand for power in South Africa.

Eskom states that the aim is to increase the capacity of each of the station's six 350-MW units to 400 MW by the end of 2010, while simultaneously extending the station's life. Almost an additional unit of capacity will be gained, without the equivalent cost of building a new unit.

The sedimentation plant has been successfully commissioned and units two and three have successfully completed their performance tests. Unit six is currently undergoing its commissioning phase, leaving three units remaining for the completion of the project.

As part of the project, the HP and IP turbines will be replaced, the LP turbines and the station's pumping capacity upgraded, and boiler modifications carried out. Global power generation specialist Alstom is designing and installing the 288 new pulverised coal-firing ceramite burners that are replacing the power station's original stainless-steel burners.

Mill upgrades, the replacement of primary-air fans, boiler tubing replacements and economiser upgrades including the associated control and instrumentation changes will also take place. A new sedimentation is also included.

Return-To-Service Projects
Eskom is demothballing three of its coal-fired power stations, namely Camden, Grootvlei and Komati, each of which will have an operating life of between 15 and 20 years. The return-to-service projects will be completed by 2011 and are estimated to cost about R16-billion in total.

Creamer Media's Research Channel Africa reports that the Camden power station, which is situated in Ermelo in Mpumalanga, was the first to be returned to service in July 2008. The power station cost about R5,2-billion to demothball.

Camden has eight units with a total capacity of 1 620 MW. Two generating units, with a combined capacity of 400 MW, were brought on stream at Camden each year from 2005 to 2008. The power station was in full commercial operation at the end of July 2008 after the last unit was commissioned.

The Grootvlei power station, near Balfour in Mpumalanga, has a total capacity of 1 200 MW. It is estimated that the cost of returning Grootvlei to service will amount to R4,8-billion and the last unit is expected to be commissioned in October this year.

http://engineeringnews.co.za/article/transmissions-power-lines-project-progressing-well-2009-04-17

KwaZulu Energy Services expands rural electrification programme to E Cape

Rural electrification in South Africa was not easy and did not provide a great financial resource, but did bring benefits to rural communities and was a good example of how public–private partnerships could lead to sustainable projects, KwaZulu Energy Services (KES) CEO Vicky Basson asserted on Wednesday.

KES, which was 65%-owned by European energy company Électricité de France (EDF) and 35%-owned by international oil and gas company Total, was facilitating the access to electricity for rural inhabitants in developing countries.

It was currently involved with two rural electrification projects in South Africa, one in central KwaZulu-Natal (KZN), where it had installed about 10 000 solar home systems (SHSs) and the other in the Eastern Cape, where about 30 000 houses would benefit from SHS installation.

Initially, KES planned to install about 50 000 SHSs in KZN, but progress has been hampered by institutional delays, said Basson during a French South African Chamber of Commerce and Industry event.

It was partnering with the Department of Minerals and Energy (DME) on the project, with shareholders providing a R3 500 subsidy for each installation.

The project was further funded on a fee-for-service model, with households leasing the equipment, which included a solar panel and a prepaid meter, from KES, and, in turn, being provided with a specific amount of electricity to be used during that period.

KES, in turn, provided maintenance of the equipment, as well as replacement of equipment that was no longer working, over a 20-year lease period.

A one-off R110 connection fee was paid by households, after which they would pay R69 a month for electricity. The amount of electricity was loaded onto a token, which was then placed in the prepaid meter.

Households could run four energy-efficient lights, three inside and one outside, a black-and-white television and a radio or a cellphone charger for four hours a day with the electricity provided.

Basson noted that KES was currently awaiting the finalisation of contracts for a third phase of the project.

Meanwhile, the company was just starting with a similar project in the Eastern Cape, with a German investment bank KFW, which was providing a €16-million subsidy for the supply of equipment for the project.

The other shareholders in the project were providing about €4-million in funding for equipment and about another €4-million for project development and other associated costs, such as training, said Basson.

The system used in the Eastern Cape was basically the same as that in KZN, except that the systems were larger, owing to the fact that the region has more cloudy days than KZN.

Further, it would also use a pin code rather than a token, with KES planning to eventually be able to send pin codes by cellphone when payments were received.

KES had the equipment for the first 1 000 systems on hand, but was awaiting the appointment of a monitoring consultant by KFW before it could continue. It was in discussion with the DME and KFW in this regard.

BENEFITS AND CHALLENGES

Basson highlighted that there were many benefits to the installation of SHSs in rural areas, the most important of which was that it replaced more expensive energy sources.

She stated that it would be far more costly for Eskom to supply these communities, which were based in very far outlying regions of the country, through transmission lines, as the usage of electricity by these communities would never allow for a return on the utility’s investment.

It provided a safer form of lighting than candles and paraffin, which often caused fires in informal settlements.

It would save the households time and would allow them to access television and radio for leisure and educational purposes.

Further, the projects had also led to the creation of 51 jobs for locals who had never been employed before. The locals were also given in-house training.

KES also employed small- to medium-sized black economic-empowerment (BEE) companies as subcontractors on its installations.

However, there were also a number of challenges facing KES.

Basson explained that institutional delays in the awarding of contracts to KES by the State led to additional financial costs for the company.

Further, the provision of free basic electricity by the State was also not always uniform, meaning that some households in a community could pay more for their electricity than others in the same community, with the only difference being the day the installation was done.

Households could also not afford larger systems without an increase being made in the subsidies provided, despite their electricity requirements increasing.

Crime was another challenge, specifically for the company, with a number of armed robberies already having taken place at its energy stores, where the electricity was loaded onto the tokens.

This has also forced it to limit the amount of cash it received at the energy stores, with the majority of customers having to pay the money into KES’s bank account at a Post Office branch and take a slip to the energy stores before electricity could be loaded.

Meanwhile, Basson noted that it eventually wanted to involve a local BEE partner that would take over the management of the projects once the projects had reached a point of financial and operational viability.

http://www.engineeringnews.co.za/article/kwazulu-energy-services-expands-rural-electrification-programme-to-e-cape-2009-05-06

Cape Town: R900m city electricity infrastructure upgrade
May 08, 2009 Edition 1

Staff Writer

THE Cape Town City Council has earmarked almost R900 million to upgrade the metropole's electricity network in the coming financial year.

This forms part of the R5.5 billion capital budget proposed for 2009/10.

Cape Town's electricity infrastructure consists of more than 70 main sub-stations with transformers and switchgear, as well as thousands of kilometres of electrical cables criss-crossing the city from Atlantis and Gordon's Bay, down to Cape Point.

The electricity budget includes upgrades of main sub-stations such as Retreat (R60m), Rosmead Avenue (R52m), Strand (R42m), Roggebaai (R24m), Parow South (R21m) and at Langeberg in the northern suburbs (R18m).

According to Ian Neilson, mayoral committee member for Finance, Economic and Social Development and Tourism, the council cannot allow a second Eskom crisis to occur by waiting for equipment to fail before replacing it.

"We proactively implement a maintenance and replacement programme to facilitate economic development and create jobs," said Neilson.

Last year, the council spent R350m on the new Roggebaai sub-station, to augment power supply to the entire Central Business District and the Atlantic Seaboard for the next 15 years.

This year, capacity at the Retreat main sub-station will be increased by replacing the underground cables, two high-capacity power transformers and associated switchgear.

"These upgrades will reduce the risk of power failures," said Clive Justus, mayoral committee member for Utility Services.

"The council constantly monitors the state of all its electricity plants to determine their condition and the loads they can carry.

"An analysis of this data has shown that the equipment is ageing and reaching the end of its useful life.

"Work will start soon and should be completed by June 2010," Justus said.

Happy April fool Mo.....

The April's fool articles aren't catching out people like they would in the past.
I think these articles should be moved a day earlier...!

Eskom’s build programme stimulates R120m new pressure-part investment

The R120-million, fast-track expansion of SPX-DB Thermal’s pressure-part manufacturing facilities in Nigel, east of Johannesburg, which will produce boiler pressure parts for Eskom’s Medupi and Kusile power stations, has been completed and production has started.

The project, which has been funded in equal portions by US manufacturing group SPX and Hitachi Power, is part of a larger R1-billion investment promise made by Hitachi, arising from local-content commitments made to Eskom after it placed boiler contracts valued at close to R40-billion.

The contracts are the single largest ever awarded by the South African power utility and, along with turbine contracts that were placed with energy and transport vendor Alstom, make up the heart of the two new coal-fired power stations.

Together, Medupi, which is being built near Lephalale, in South Africa’s Limpopo province, and Kusile, which is being erected almost simultaneously in the Mpumalanga province, will cost over R200-billion and will add a gross 9 600 MW of new generation capacity to Eskom’s power-stressed network by 2017.

Hitachi Power Africa CEO Johannes Musel tells Engineering News that it has committed to sourcing 60% of the contract value within the border of South Africa and that the company is on track to achieve that target.

Besides its significant relationship with SPX, it has also signed contracts with engineering contractor Murray & Roberts and is sourcing manufacturing services of other boiler parts from Steinmuller.

DB Thermal in South Africa MD Heinz Spreitzer tells Engineering News that the plant, known internally as Nigel 5, was built in less than a year – an unprecedented turnaround even within the larger Fortune 500 SPX group, which has facilities in 40 countries and employs 17 000 people worldwide.

He adds that the new 11 000-m2 plant, which has extended the overall Nigel facility to 33 000 m2, will produce world-class pressure parts, such as membrane walls and headers. These components will be used in the 12 boilers being installed by Eskom, but could also be supplied to other future power projects in the region and elsewhere.

There was also potential to swing some of the production towards petrochemicals projects, with both Sasol and PetroSA pursuing ambitious projects.

The facility will also produce high- and low-pressure feedwater heaters, as well as air-cooled condenser tube bundles.

Crucially, especially from Eskom’s perspective, the facility and the other boiler-linked contracts placed by Hitachi domestically will also have job-creation spin-offs. This is a key driver of government policy and also central to the Competitive Supplier Development Programme (CSDP), which governs the State-owned utility’s procurement.

Eskom is under increasing pressure to show that the CSDP is delivering against government’s target of reducing the imported content of the South Africa’s bigger R787-billion three-year infrastructure programme from 40% to around 30%.

CEO Jacob Maroga has described Eskom’s R385-billion expenditure programme as a “ready-made stimulus” package, but also has also indicated that there is increasing pressure on the utility from its shareholder, the South African government, to “leverage” the programme for greater domestic economic advantage.

Eskom will spend R87-billion in 2009/10 on capital expenditure programmes, with peak spending of R104-billion anticipated in 2010/11.

Spreitzer reports that DB Thermal already has 650 permanent and contract employees working at offices in Woodmead and Nigel, as well as at four of the power station sites of Camden, Komati, Grootvlei and Secunda. He adds that more jobs will be created as production picks up, with staff levels at Nigel alone likely to rise from 320 people to 450 employees by August.

He adds that Nigel 5 incorporates the most modern Hitachi-specified and funded pressure-part manufacturing machines available and that first delivery into what is a R4-billion order from Hitachi will begin “within weeks”.

“These are the single largest orders ever received, not only for the South African business, but for the entire SPX group,” Spreitzer enthuses, adding that the programme is drawing in skills from around the world.

Musel says that Hitachi is pleased with the progress that has been achieved in creating local capacity to deliver into the Medupi and Kusile programmes, adding that work was progressing on schedule.

The first steel fabrication is under way at the Medupi site and all long-lead items and materials, some of which are too specialised to produce locally, have been secured.

“There has been unprecedented cooperation to ramp up local capacity and we believe the new SPX facility will showcase South Africa’s ability to manufacture to world-class levels,” Musel concludes.

http://engineeringnews.co.za/article/eskoms-build-programme-stimulates-r120m-new-pressure-part-investment-2009-05-08

Uncertainty over tariff-capex dynamic forces Eskom into ‘interim’ 34% request

After months of speculation and delay, Eskom has eventually made an application to the National Energy Regulator of South Africa (Nersa) for a price increase, submitting a request for a nominal 34% increase (25% real) for 2009/10.

But the submission has been described by Eskom as merely an "interim" application, with the utility planning to make a more comprehensive request once it has completed work on a so-called “integrated funding model” for its R385-billion, five-year capital programme.

Spokesperson Fani Zulu told Engineering News Online that the utility had already had several consultations on the matter with government, labour and other stakeholders, and that it would be seeking finality on the funding model during the course of its current financial year, which would end on March 31, 2010. The application, therefore, excluded the new build capital expenditure, repairs and construction of roads and the 2c/kWh environmental levy.

The model would seek to clarify how the utility could close a funding gap of about R270-billion through a combination of equity injections and loan guarantees from its shareholder, the South African government; borrowings on the domestic and foreign capital markets; and retained earnings. The last element would depend materially on the level of tariff increases granted.

Currently, Eskom was uncertain whether tariff increases could be included in helping it to raise part of the funding it required for its unprecedented capital investment, which was needed to add about 13 000 MW of capacity and thousands of kilometres of transmission infrastructure.

This uncertainty has increased materially in recent weeks, with Nersa’s spectacular rebuttal of sister State-owned utility Transnet, which had sought to secure a substantial tariff increase to help it fund a R12-billion fuel-pipeline expansion.

Nersa refused Transnet’s 74,4% tariff request, stating that it did not have the legal authority to set tariffs for existing pipelines in a manner that enabled a licensee to recover the costs for pipelines that were still in the process of being constructed. The regulator then instituted a tariff reduction of 10,38% for the financial year, leaving Transnet to seek alternative funding arrangements.

Given this uncertainty, Eskom had decided to make a submission to Nersa, which it saw as falling outside of the framework of the second multiyear price determination period (MYDP-2), which was meant to have run for the three-year period from April 1, 2009, through to March 31, 2012.

“We have adopted this approach of applying for an interim increase to ensure healthy cash flows for the current financial year, but also to create space for the creation of an appropriate funding model,” Zulu outlined.

A new MYPD-2-linked application would be made at a later stage, once it was agreed with stakeholders whether tariffs could or could not be used to fund capital projects. Should such an outcome be agreed, changes might have to be introduced to the regulations, which currently only explicitly grant Eskom the right to a fair rate of return on current assets, as well as the right to recover prudently incurred operational and primary-energy costs.

However, Nersa’s Charles Hlebela did not believe the tariffs-for-capex dynamic was a major constraint, telling Engineering News Online that there was no sign that the Electricity Regulation Act prohibited the national utility from recovering the costs for infrastructure that was still in the process of being developed.

However, he acknowledged that Eskom appeared to want absolute certainty about its entire funding model before making any application under the MYPD-2.

R130BN GAP

In the meantime, Eskom, which expects to spend R87-billion in 2009/10 and its expenditure to peak at R104-billion in 2010/11, before declining to around R82-billion in 2011/12, would seek to cover the funding gap from borrowings and direct shareholder support.

Over the three-year period, a financing gap of about R130-billion was expected to arise – this, after the R60-billion loan from National Treasury, and the additional money that could be raised on the back of the R176-billion in loan guarantees extended to Eskom by the National Treasury. For 2009/10 a funding gap of R27-billion was expected, after the R30-billion loan injection from the National Treasury and fund-raising of a further R30-billion on the back of the guarantees.

Zulu said that this reality might force Eskom to accelerate it borrowings programmes, as well as its efforts to secure fresh finance from development finance institutions, such as the World Bank and the African Development Bank.

But to close the gap on a sustainable basis would require consensus from stakeholders, including whether the regulator was allowed to grant tariff increases in such as way that these could be used to help fund future infrastructure.

It was unlikely, therefore, that the issue would be clarified during the upcoming process to evaluate Eskom’s application for a 34% increase.

That is possibly also why news of Eskom’s application emerged without fanfare in the form of a paid advert published by Nersa on Friday.

The advert stated that the regulator had received Eskom’s application on May 5 and was now open to receive written comments until June 2.

Nersa would hold public hearings into the application on June 8 and 9, and make its determination on June 25.

Eskom's submission was broadly in line with the suggested price path outlined by Nersa last year of between 20% and 25%.

However, that price-path had been premised on far stronger demand conditions than was currently the case, with demand for electricity having tapered off markedly in line with slowing economic conditions.

It also emerged after Eskom had asked for a massive 67% increase to deal with surging primary energy costs. The regulator eventually granted 27,5% increase after an intensive public process, which ultimately took its lead from a National Economic Development and Labour Council energy summit, which stressed the need for a “smoothing mechanism”.

STRONG OPPOSITION

Nersa would not be drawn immediately on whether economic conditions had changed such that it could alter its price-path view. But there will be definite pressure on the regulator to ensure that Eskom's increase is moderated. Hlebela stressed that Nersa was still analysing the content of the submission and could, thus, not comment.

That said, there is sure to be definite pressure brought to bear on the regulator to ensure that Eskom's request is moderated.

There is expected to be strong societal opposition to any increase, with South Africa’s largest labour federation having already threatened another national strike.

Congress of South African Trade Unions (Cosatu) general secretary Zwelinzima Vavi said recently that it had never agreed with Nersa’s price path and that the union would oppose any move to grant such material increases.

On Friday, Cosatu put out a statement saying it was “totally opposed” to the increase and urged Nersa to reject it.

“Such a massive increase would inflict misery on thousands of poor households,” Cosatu said, adding that it would also hit hundreds of small and medium businesses that were already struggling with the effects of the global financial crisis.

Cosatu stressed, though, that it was not opposed to an increase that reflected increases in running costs, but argued that these should correspond with the current rate of inflation of 8,5%.

“Consumers should not have to shoulder Eskom’s capital cost of building new generating capacity. This must come from government, who failed to provide these funds in the late 1990s despite Eskom’s warning that there would be a crisis if they were not given the money at that time,” the union added.

This said, there was also a growing acceptance, particularly within business, of the need to move towards more cost-reflective tariffs. But there had also been a strong appeal for such a transition to proceed in a manner that avoided price spikes.

http://engineeringnews.co.za/article/eskom-makes-long-awaited-34-price-increase-application-to-nersa-2009-05-15

Churchill’s grandson in SA power push

Generator rental and temperature control services company Aggreko has opened its first African branch in Midrand, Johannesburg.

A total of $10-million will be invested in the branch initially. The company has remarked that the increase in industrial growth in South Africa will result in a bigger demand for power in the country.

The company employs an estimated 
3 500 employees operating from over 133 locations. Aggreko CEO Rupert Soames is the grandson of World War Two icon Winston Churchill.

Even though the South African branch is the company’s first foothold in Africa, it has been active on the continent for more than ten years, operating large-scale power projects in countries such as Kenya, Ethiopia, Tanzania and Angola as well as South Africa.

The company decided to locate a branch in South Africa because this will allow it to support its African customers with reliable temporary power solutions. In particular, the company is seeking to support industries such as manufacturing, shipping, process industries, events and construction.

“The depot in Midrand will allow us to provide support to the local market by offering reliable temporary power systems within very short timescales. 
“The company is committed to Africa and currently has over 800 MW operating in 27 countries.

“In addition, we are seeking to transfer skills and knowledge wherever we can to the graduates, engineers and technicians that are employed by our company in South Africa. 
“Currently, over 79% of our staff in Africa are locally employed Africans, and we intend to continue our in-house training and development process,” says Aggreko Africa director Steve Aitken.

Aggreko International supplies multi-megawatt power packages to various industries worldwide. 
The applications for rental power can entail providing power during the commissioning of a mine site, or to ensure uninterrupted broadcasting of a major sporting event or additional baseload power for a country’s utility grid.

Typical projects the company undertakes can range from the rental of an 800-kVA generator to run machinery at a factory, or a 15-kVA generator to power a construction site cabin or the rental of a series of 30-kVA generators to power telecommunications towers.

http://engineeringnews.co.za/article/winston-churchills-grandson-brings-his-generator-company-to-sa-2009-05-22

Nuclear-1 a certainty?

May 25 2009 at 07:49PM

By Melanie Gosling

Eskom appears to be kickstarting its massive nuclear energy plans again.

The utility, which halted its nuclear bidding programme for Nuclear-1 in December last year, has now revised its application to the environmental authorities, asking to be allowed to combine authorisations to develop Nuclear-1, Nuclear-2 and Nuclear-3 power stations at all three coastal sites earmarked for the nuclear programme.

The three sites are Bantamsklip near Pearly Beach in the Overstrand, Thyspunt near Oyster Bay in the Eastern Cape and the Koeberg site of Dynefontein 30km north of Cape Town. At the start of the environmental impact assessment (EIA) the three places were to be assessed as alternative sites for the proposed Nuclear-1.

Now, because of amendments to the environmental legislation which are in the pipeline, Eskom has applied to Water and Environment Affairs to "sequentially construct" nuclear power plants at all three sites in a combined application, starting with Dynefontein, followed by Bantamsklip and Thyspunt.

"Thus specialists will no longer be required to compare, rank and provide recommendations with respect to a single preferred site", but will only compare different layouts and positioning of the nukes on each site.

The application includes the "roll-out dates" for the first three nuclear power stations: site preparation for Nuclear-1 will start in January next year and the nuke will come online in July 2018; site preparation for Nuclear-2 will begin in January 2013 and come online in July 2020 and Nuclear-3 site preparation start in January 2015 and come online in July 2022.

Hm, interesting. So why don't they build them all at the same time? Shortage of skilled personnel?

SA targets 4 000 MW nuclear plant by 2018

South Africa, plagued by chronic power shortages, has set 2018 as an indicative date for when it wants its next nuclear plant to be operational, utility Eskom said on Tuesday.

State-owned Eskom, which operates Africa's sole nuclear power plant with a total capacity of 1 800 MW, cancelled plans to build a new facility at the end of last year, citing financial constraints.

The government has since taken the lead in developing the next power station, saying it wants to develop a local nuclear industry in partnership with a technology firm rather than adopt a commercial bidding process used by Eskom.

Both the government and Eskom have set the new timelines as part of a revised plan for the environmental impact assessment (EIA) which the utility submitted for public comment this week.

"All this is part of the government-led process: we have set indicative timelines, in line with the projected growth in electricity consumption ... but they are not cast in stone," Eskom spokesperson Fani Zulu said.

South Africa depends on coal for some 90 percent of its energy supply and the government has long identified nuclear as a way to diversify power supply to reduce its carbon footprint.

Construction for the first unit could begin in July 2012, with the first 4 000 MW plant to be operational by July 2018.

Two other facilities with the same capacity are planned to be operational by 2020 and 2022, respectively.

"We will have a firm timeline once we have signed contracts with those who will be constructing the plant ... and once the funding is in place," Zulu said.

He declined to say whether the government and Eskom would be able to source the funding needed to build the plants in the indicated timeframes.

The EIA proposal suggests three potential sites for the next plants -- the western coast, where the existing plant is located, on the south- eastern coast near St Francis Bay and on the south-western coast near Pearly Beach.

http://engineeringnews.co.za/article/sa-targets-4-000-mw-nuclear-plant-by-2018-2009-05-26

Hm, interesting. So why don't they build them all at the same time? Shortage of skilled personnel?

Part that, but I suspect its because Koeberg won't need such things an environmental assessments, because a nuclear power station is already there. Cost may be a factor too, because nuclear power stations cost substantial $$$.

I see.

Anyone know what sites are in contention for the proposed new nuclear plant?

They surveyed the area between Pearly Beach & Gansbaai about 15-20 years ago, but I don't know if that's still a viable site or if they didn't want to go ahead with it at that time.

Koeberg unit 1 to be shut for at least three weeks for maintenance

Power utility Eskom reported on Friday that unit 1 of the Koeberg nuclear power station, in the Western Cape, would be shut as from 02h00 on Saturday morning in order for it to perform maintenance work on the electrical generator.

The unit will be shut and unable to generate electricity for a minimum of three weeks.

The utility gave the assurance, however, that the supply of electricity to the Western Cape should not be affected by the shut down.

"During this period, the Cape will be supplied from other power stations in the north of the country along with the two new open cycle gas turbine (OCGT) power stations in Atlantis and Mossel Bay whose output has recently been doubled," Eskom said in a statment released on Friday evening.

The doubling of the capacity of the two new OCGTs was completed in March, increasing the output of the two diesel-fuelled stations from about 1 000 MW to a total of 2 100 MW. Koeberg's capacity is 1 800 MW.

http://engineeringnews.co.za/article/koeberg-unit-1-to-be-shut-for-at-least-three-weeks-for-maintenance-2009-05-29

Transnet proceeding with pipeline, but warns of even higher future price spike

State transport utility Transnet said on Thursday that the construction of its R12-billion new multipurpose pipeline from Durban to Gauteng would continue as planned and would be completed and operational by December 2011, despite the regulator having turned down its 74,4% tariff-increase request.

But it warned that tariffs were now likely to spike even more substantially once the pipeline was commissioned, given that the tariff-setting methodology entitled it to recover the amount it had requested in its application.

Earlier in the week, the National Energy Regulator of South Africa (Nersa) refused Transnet’s request for an average 74,42% pipeline-tariff increase for 2009/10, and instead instituted a tariff reduction of 10,38% for the financial year.

Given that the first month of Transnet’s financial year had already expired, the adjustment would be spread over 11 months, resulting in an actual tariff reduction of 11,17% over the remaining months of the tariff period. This translates into a 1,37 c/l reduction in the Gauteng petrol price.

Nersa's full-time member primarily responsible for petroleum pipelines regulation Dr Rod Crompton told Engineering News that the decision was based on advice from two separate senior counsels. Both warned that Nersa did not have the legal authority to set tariffs for existing pipelines in a manner that enabled a licensee to recover the costs for pipelines that were still in the process of being constructed.

Crompton stressed that Transnet still had its licence and that he was convinced that other funding mechanisms could be found, so that the project could continue so that security of supply was not undermined.

“The effect of Nersa’s decision is thus to defer the inevitable tariff increases to when the pipeline is brought into use,” Transnet spokesperson John Dludlu said in a statement, adding that Transnet was entitled to recover the amount it had requested and that this recovery had simply been postponed.

He warned that this would lead to “substantially higher tariff increases” in future.

“In effect, consumers will have to pay for both the capital expenditure plus the associated interest when the pipelines being constructed are commissioned,” he added.

Transnet stressed, however, that the Nersa decision would not significantly prejudice the group on a net present value basis. Rather, Transnet was affected by the timing of such revenue.

Dludlu said that a “contingency plan is in place to make up for this timing shortfall” and was being activated.

“Therefore, the construction of the new pipelines continues as planned and will be completed and operational within the prescribed timeframes: that is, by December 2011.”

The utility also rejected as “erroneous” the impression that it failed to follow the correct methodology.

It argued that it based its application, submitted on November 11, 2008, on the applicable regulations and the approved tariff methodology.

It had also drawn on previous decisions by Nersa, as well as the interpretations and advice provided by senior counsel.

Transnet said it was concerned about inconsistencies in Nersa’s decisions, which now create significant cash flow uncertainty, which “makes planning and structuring optimal funding solutions difficult”.

http://engineeringnews.co.za/article/transnet-proceeding-with-pipeline-but-warns-of-even-higher-future-price-spike-2009-05-07

Joint SADC power projects seen saving $48bn

Countries in the Southern African Development Community (SADC) could save up to $48-billion on power projects planned in the region by 2025 if they developed them jointly, an energy specialist said on Friday.

Jean Madzongwe, an energy official from the Development Bank of Southern Africa (DBSA), said the region was working on projects expected to add 57 000 MW to Southern Africa's power capacity by 2025 at a total cost of $83 billion.

"Almost all of these projects are being developed as individual projects by national utilities... potential savings of $48-billion could be realised if the region worked together," she told a meeting of South Africa's energy sector.

Southern Africa has struggled to meet rising electricity demand in the region, owing to a lack of investment in new power generation capacity over the last two decades.

Madzongwe said the region shared similar challenges with the need to adopt cost-reflective tariffs to attract investments, to open up the regulatory frameworks and translate national energy agendas into action.

She said the DBSA was working with the Southern African Power Pool to identify smaller, manageable projects which could easily be developed jointly.

"We need to look at smaller projects, less than 100 MW, which will benefit more than one country ... if we can get one or two off the ground in a joint approach, this is the way forward," she said.

A regional roundtable with potential power sector investors will be held in Zambia in mid-July, she added.

http://engineeringnews.co.za/article/joint-sadc-power-projects-seen-saving-48bn-2009-05-29

Eskom may need private partner to fund expansion


South Africa's Eskom may have to form a public-private partnership to fund its new power generation programme without having to increase tariffs by 90%, a government official said on Thursday.

Eskom applied for a 34% increase in the tariffs last month, but said it might have to ask for more by the end of the year if it fails to source the money elsewhere.

The state-owned utility has launched a R385-billion expansion over five years to ease power shortages in Africa's biggest economy, but has failed to raise all the capital in the face of the global financial crisis.

The country's power regulator said last week Eskom would need a 90% increase in tariffs this year if it failed to get the funding required for this year's part of the programme.

Nelisiwe Magubane, deputy director general at the country's newly formed energy ministry, said the alternative option was for Eskom to partner with others, or the government to give Eskom another capital injection or supply further guarantees.

"Eskom can request government to get more guarantees, [can ask] government to do an injection or ask for a partnership so that the projects get done," Magubane said.

She said no projects would be delayed given the necessity to increase power supply in the country.

Magubane said Eskom had not yet approached the government about a partnership possibility, but discussions on the proper funding model for the utility were ongoing.

She said the Kusile power plant project - one of two coal-fired 4 800 MW power stations Eskom is building as part of the expansion programme - could end up in a partnership deal.

She said the government was working to find a way forward for its nuclear programme which has stalled after Eskom cancelled a tender process last year citing financial woes.

http://engineeringnews.co.za/article/eskom-may-need-private-partner-to-fund-expansion-2009-06-04

Eskom plans to use economic downturn to reduce capital costs

Changes in market conditions present a significant opportunity for Eskom to reduce the capital costs of its new build programme, acting MD of the enterprises division Braam Conradie told delegates at the South African National Energy Association (Sanea) Action for Energy conference on Friday.

Eskom was spending R385-billion on its capital expansion projects over a five-year period, with Conradie noting that this formed an integral part of government’s response to the global economic crisis.

The power utility was planning to make good use of the economic downturn, he noted, saying that it was expecting to get better prices from suppliers and that it would also try to renegotiate certain contracts.

Eskom would look for savings everywhere, including its capital expenditure and its operating expenditure, with Conradie noting that “everything is up for debate”. He admitted that there would be some offsetting factors, such as the price of equity.

This meant that there could be some decreases in some costs and some increases in others, but he emphasised that the utility was obligated to look at every opportunity.

Conradie said that Eskom was still experiencing a funding problem and that a number of variables could impact on whether it delays any further projects.

Eskom had already delayed some of its projects, including a wind energy project, the Majuba rail project, the Tubatse pumped-storage project and its Nuclear 1 project, owing to the economic environment.

He explained that Eskom obtained its funding from three sources, namely debt, equity and tariffs. The extent to which it would be able to close its funding gap with the contribution from these three sources would be a key consideration in deciding if any other projects had to be delayed.

Everything was a trade off between what it could afford and what it could not afford, he noted.

The average wholesale price of electricity was 16c/kWh in the previous financial year, while the cost of producing electricity at its new Medupi and Kusile power stations would be at least three times that amount.

The utility would have to fund these higher costs somehow.

Conradie asserted that ultimately all these costs would have to be funded through tariffs, saying that debt and equity would only provide additional time for tariffs to be increased.

Eskom has made an application with the National Energy Regulator of South Africa (Nersa) for an interim tariff increase of 34%.

Public hearings on the matter would be held on Monday and Tuesday.

http://engineeringnews.co.za/article/eskom---energy-for-action-2009-06-05

SA slow in tapping coal bed methane potential

South Africa needs to invest in gas infrastructure and exploration and involve the country's coal mining majors to develop a coal bed methane (CBM) industry, a coal consultant said on Friday.

Oliver Barker, an independent consultant at Banzi Geotechnics, told a coal conference that CBM could be a quick way to ease the power shortages which led to shutdowns at mines and smelters early last year.

"It can be brought on stream very quickly, it's immediate, there's no beneficiation, the moment you bring it to the surface you can use it," he said.

South Africa is one of the world's largest coal producers and methane gas could be exploited as part of the coal mining process, but hardly any of the mining companies have tapped its potential.

Barker said some of the mining giants who have the capital fear the impact that the exploration of CBM could have on the quality of their coal.

The other problem was the lack of data, Barker said, adding that estimates for potential in the country range between 15 and 40 trillion cubic feet (tcf).

Making CBM part of the government's energy plan and establishing a model for state-owned utility Eskom to use gas to power its plants would be one way of moving the industry forward, he said.

"The government needs to realise CBM's potential for power production and for reducing our carbon footprint ... we need to develop the infrastructure and develop a financial model to help people assess the potential of it," he said.

http://engineeringnews.co.za/article/sa-slow-in-tapping-coal-bed-methane-potential-2009-06-05

SA’s wind-energy capacity could be 300 MW by 2012 – study

Wind-energy developments could supply up to 300 MW into South Africa’s electricity grid over the next three years, a new research study shows. However, the country’s energy-supply industry would continue to lag far behind that of countries in North Africa, which have far more ambitious targets and where there is already significant deployment experience.

Further, there are additional concerns, not raised in the study, that the roll-out of wind and other renewable technologies could be constrained by a desire among the South African authorities to limit tariff increases, which are already set to rise aggressively.

Frost & Sullivan energy research analyst Sipha Ndawonde argues that the lower upfront capital costs, as well as shorter lead times, will allow wind power projects to add additional capacity to the national grid far quicker than new coal or nuclear energy facilities.

However, the contribution of such projects will depend materially on issues such as grid capacity, private sector investment, environmental application processes and the regulatory environment.

The study suggests that, prior to 2006, there was a lack off urgency in South Africa to reduce electricity consumption and introduce energy efficiency measures, which also dulled the pressure on Eskom and private suppliers to explore alternative forms of generation.

But given the power disruptions of 2007 and 2008, and a new renewable energy feed-in-tariff (Refit) structure that “surpassed” the expectations of stakeholders, Frost & Sullivan anticipates that wind energy projects could begin to play a larger role.

That said, the study argues that South Africa should draw lessons from North Africa, which is home to over 97% of the total installed wind power on the continent, most of which is installed in Egypt, which already has an installed base of 365 MW, Tunisia and Morocco.

These three countries also installed 99% of the 104 MW of new wind power added across the continent in 2008.

Frost & Sullivan argues that the progress made in the territory was based on the identification, with experts, of the real potential for wind energy, and the involvement of development finance institutions in assisting to fund projects on favourable terms.

“Without accurate data on the wind speed and wind variability at a specific site, equipment manufacturers, project developers and investors will not be interested in investing time and resources into a project,” Ndawonde asserts.

He adds that South Africa may never catch up with its Northern counterparts, but that it has all the resources necessary to develop a significant wind energy industry.

“The wind potential is abundant, regulatory incentives are favourable and project developers, equipment suppliers and financiers have already expressed intent to get involved in the sector.

“What is required now is more dialogue between the regulators of the renewable energy industry on issues such as grid stability, grid connection costs and the timeframe in which these issues will be resolved,” he concludes.

OTHER CONCERNS

Not included in the report, but an issue that appears to be emerging as a potential constraint, is a view that the authorities will seek to contain the price increases associated with renewable-energy projects, which would have the effect of limiting the number of projects sanction and introduced.

There are hints that the regulator, government and Eskom could seek to restrict the renewable- and independent power producer (IPP)-related price increase in the overall electricity tariff to 10% over the next three years.

The regulator has insisted that, although the Refit tariffs were significantly higher than the current Eskom tariff of about 22c/kWh, they would add only between 6% and 10% to the average tariff once the full 1 100 MW of capacity, which was being targeted for 2013, was installed and operational.

But should the authorities insist on a limit of 10%, Hatch principal consultant Dieter Metzner warns that new renewable and conventional IPP capacity could well be limited to a paltry 1 500 MW over the period, against a potential wind-energy pipeline alone of around 3 000 MW and a larger cross-technology pipeline of more than 5 000 MW.

There is also growing concern about the competitive tender processes that Eskom, as the designated ‘single buyer’, plans to implement.

Ian de Jager, an engineer working on various renewable projects, tells Engineering News Online that such a process appears to be out of step with the Refit, which suggests a “first come first serve” approach to licence applications and subsequent power purchase agreements (PPAs) with the single buyer office, or renewable energy purchasing authority (Repa).

Consequently, de Jager argues, the Refit may be run as a commercial programme, where bids won’t be evaluated against the prices as published by the regulator in the Refit, but on other criteria that remains somewhat opaque.

Under the Refit a wind tariff of R1,25/kWh was sanctioned, while small-scale hydro would receive 94c/kWh, landfill gas 90c/kWh and concentrated solar, with a storage capacity of more than six hours, would receive R2,10/kWh. Other renewable technologies, such as biomass and photovoltaic, could be added in the coming months.

But should a competitive process be pursued, only successful bidders would then be invited to enter into a PPA with the Repa rather than those that were first through the licencing door.

Matzner says there is also significant confusion among potential developers about how precisely a PPA will be procured.

Further, there was uncertainty about whether the rules provided sufficient protection in what would come down to robust commercial discussions with a powerful single buyer office, or Repa, which is housed within the incumbent utility.

http://engineeringnews.co.za/article/sas-wind-energy-capacity-could-be-300-mw-by-2012-study-2009-06-01

R1,8bn ethanol-from-sugar plant planned for KZN

Private investors have reportedly put up R1,8-billion to build a new sugar processing facility in the rural Makhathini area, in KwaZulu Natal, to possibly produce ethanol and other sugar products.

Trade and Industry DG Tshediso Matona said that the project, for which the Department of Trade and Industry (DTI) had partnered with the local municipalities and local sugar growers, was an important rural development project supported department.

“The role of the DTI is to facilitate investment into Makhathini,” said DTI director agroprocessing Imamaleng Mothebe at a South African Sugar Association (Sasa) function marking the opening of the sugar season on Thursday.

“The investment into the project is 100% private-sector funded through development financing institutions, as well as some members of the sugar industry and other private investors.”

Mothebe revealed that State-owned power utility Eskom was one of the stakeholders that form part of the committee on the Makhathini project.

“There is work between Eskom, the Industrial Development Corporation and the Central Energy Fund around issues of cogeneration and ethanol,” she said.

She explained that the prefeasibility studies for the project had already been completed, and that a full feasibility study, with an environmental-impact assessment study, was currently under way, which she expects to be completed soon.

“As it stands now, pending the outcome of the feasibility study, the first option is ethanol production, and obviously there will be some level of sugar production as well for other purposes,” she said.

Matona said that the project would create 1 800 direct jobs.

“The biggest advantage of the project is that it would justify investment in much needed critical infrastructure within one of the least developed regions within the country. Once completed, the improved infrastructure in the area should generate more investments in areas other than just sugar.”

Matona said that the project was already part of the DTI’s current Industrial Policy Action Plan (IPAP).

“For South Africa, it is important that an appropriate policy environment be created that would establish real markets for renewable energy products,” he said.

“This will not only improve our overall carbon footprint, but would unlock substantial further investments in the sugar sector.”

Matona said that a scaled-up IPAP was currently under development, in which greater priority would be given to agroprocessing subsectors.

“A draft strategy for agroprocessing that is aligned with primary agricultural strategies is being developed and should be finalised in the near future,” he said. “Given the uniqueness of distortions in the agricultural field, it is important to have national structures in place that respond to these challenges to ensure the establishment of a fair and equitable environment for the optimal development of the sector in South Africa, as well as the region.”

Sasa chairperson Martin Mohale said that the markets for sugar-cane based renewable energy have manifested as a major opportunity for the South African sugar industry, adding that the nonparticipation in those markets could potentially impact negatively on the sustainability of the South African sugar industry and its competitive position in comparison to global sugar industries where renewable energy income streams are introduced on a mandatory level.

Mothebe said that the Makhathini sugar-processing facility will be commissioned in 2011.

http://engineeringnews.co.za/article/r18bn-ethanol-from-sugar-plant-planned-for-kzn-2009-06-12

Good, revealing article...

-------------------

Shocking abuse of power
Lauren Cohen Published:Jun 27, 2009

All is not equal when it comes to how much we fork out for electricity

Economist: Some SA consumers will pay more than residents in Washington and Colorado
For those still battling to come to terms with Eskom’s 31% price hike, it might be difficult to comprehend that two people living in the same street can end up paying different bills for the same amount of electricity.

This is because the price of power differs depending on who supplies the electricity, Eskom or a local municipality. And even then, not all municipality tariff structures are the same — the price at which they buy power from Eskom depends on their location in South Africa, how much they buy and what time of day the bulk of it is used.

Even Eskom charges different tariffs, depending on how much power a consumer uses.

On Thursday, the National Energy Regulator of South Africa granted Eskom a 31.3% tariff increase. But that is not where it ends. In just three months, Eskom plans to apply for yet another price hike for the financial year starting April 1 2010.

Eskom spokesman Fani Zulu could not say what percentage increase they would ask for.

Using current prices to calculate an approximate monthly fee for homes consuming 500 kilowatt hours (kWh) per month, we used Eskom’s Homepower 4 standard electricity tariff for medium to high- usage residential customers.

These fees are broken up into daily network and service charges and an energy charge per unit.

Fees differ between cities — depending on their distance from the old Johannesburg Post Office, the historical measuring point. Durban Eskom customers pay a transmission surcharge of 1% more on network and energy charges, East London 2% and Cape Town 3%.

The way in which municipalities and Eskom structure tariffs makes the drawing of an exact comparison impossible.

In Cape Town, in the domestic low- user category, the average consumption of 500kWh per month is billed, by the City of Cape Town, at R324.27. But Eskom-supplied households pay R343.55.

“The city supplies about 550000 consumers, and Eskom about 140000 consumers in the Cape Town municipal area,” said tariff development head of the City of Cape Town, Don Early.

The City of Johannesburg has three tariff structures: prepaid electricity users, who are charged an all- inclusive rate depending on how much energy they consume; single- phase supply for the average family home; or a three-phase supply for a larger property which requires more power.

The latter two tariff structures have service and network fees as well as a different energy charge for summer and winter.

A prepaid City of Johannesburg customer using up to 500kWh a month would pay R327, while Eskom customers pay R335.35.

“We provide 1.3-million residents with power,” said city spokesman Virgil James.

Durban’s eThekwini municipality users pay R290.40 for 500kWh and Eskom users pay R338.08. The municipality services 587000 residents and Eskom about 22000.

Eskom general manager of business strategy and integration, Andrew Etzinger, said 60% of electricity produced by Eskom was sold directly to customers and 40% to municipalities.

“The transmission surcharge compensates Eskom for electricity lost in the form of heat along the way,” he said.

Economist Mike Schüssler has criticised municipalities for ripping off consumers. Using Statistics SA data, he calculated that the Western Cape makes a 118.6% profit, KwaZulu-Natal a 74% profit and Gauteng a 56% profit — on the combined sale of electricity and water.

“These figures exclude the bad debt and are across the board — ANC and DA municipalities.”

Schüssler said that after Eskom’s latest price hike, residential consumers in Cape Town and Johannesburg would be paying more for electricity than some American states, including Washington, Colorado, Ohio, Arizona and Nebraska.

The National Consumer Forum will hold a public meeting in Soweto on July 25 to discuss responses to the increase. Chairman Thami Bolani said consumers had every right to feel betrayed by the regulator, which had “acted as Eskom’s rubber stamp”.

“It has been a tough week, with stiff increases in electricity tariffs, petrol — and no interest rate cut.”

http://www.thetimes.co.za/PrintEdition/Article.aspx?id=1024845

Cape Town awards ABB $17m power project

By: Creamer Media Reporter (http://www.engineeringnews.co.za/author.php?u_id=1013)
16th July 2009
Updated 16 minutes ago



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Power and automation technology group ABB has been awarded a $17-million contract from the City of Cape Town electricity services department to assist in improving the reliability of power supplies to the region.

The orders were booked in the second quarter.

ABB stated on Thursday that for one of the projects, the company would replace and maintain interlocking equipment that ensures the safe operation of switchgear at three substations and a power station in Cape Town. ABB would also provide REF 545 feeder terminals for the protection, control and supervision of a high-voltage transmission network.

For another project, ABB would deliver a range of medium-voltage equipment including compact gas-insulated switchgear (GIS), rated at 12 kV, 24 kV and 36 kV, and ancillary equipment for nine substations in the Cape Town area.

More than 200 GIS ZX1,2 panels will be supplied for this second project. The ZX series of GIS panels feature a hermetically sealed system with a stainless tank that contains all live parts and the panels’ switching functions. The constant atmospheric conditions in the sealed unit make it virtually maintenance free, highly reliable and safe for users.

“Upgrading these installations will help strengthen grid reliability and improve the quality of power supplies in the area,” said ABB South Africa CEO Carlos Poñe.

“Our state-of-the-art GIS will ensure maximum availability and extend the service life of the installations.”

The projects were scheduled for completion at the end of 2010 and were part of Cape Town’s growth and infrastructure upgrade plans.

Eskom puts R24bn Botswana power agreement on ice
August 11, 2009

By Justin Brown

A $3 billion (R24.4bn) Botswana project to supply South Africa with 900 megawatts of power to avoid blackouts and boost economic growth is on ice until Eskom's R161bn funding shortfall is resolved.

Greg Kinross, CIC Energy's chief executive, said on Friday that Eskom, with which CIC Energy has been battling to seal a power agreement for three years, could not agree to buy power from the firm's Mmamabula power project. This is until it had found a way to fund its expansion of more than R361bn by March 2013.

CIC Energy has made two long-term power offers to Eskom, the last one being in March, but the utility has delayed making a decision until it has funding in place.

Andrew Etzinger, an Eskom spokesman, said the utility still needed to evaluate CIC Energy's offer. It also needed to know that it could fund the project. Any decision to acquire power from CIC would need the approval of the government and the state energy regulator.

Eskom would put forward a funding model by the end of next month for approval by the government and the state energy regulator, Etzinger said.

"Eskom is hoping to finalise the funding model by the end of the year," he added.

Eskom's indecision drove CIC Energy's share price on the Toronto Stock Exchange to a record low late last month.

CIC Energy has to date spent $80 million on developing the Mmamabula project.

Kinross said he expected the South African government to grant Eskom further loans, but he was not able to say how much this would be above the R60bn already agreed to the utility for its expansion programme.

"CIC expects that the funding model is likely to include both direct government support to Eskom and a programme of additional tariff increases. CIC believes that the role of independent power producers in the market will be included as part of the funding model," he added.

According to CIC Energy, Eskom's need for the Mmamabula project is clear.

Taking into account Eskom's approved projects and Mmamabula, CIC is projecting that Eskom's surplus capacity will remain below the optimum of 15 percent of its total available power capacity until at least 2018.

The Mmamabula energy project is planned to produce 1 200MW of power.

If CIC Energy can seal a power purchase agreement with Eskom by the end of next March, the Mmamabula project could start to produce power from early 2014 - three years later than initially forecast.

http://www.busrep.co.za/index.php?fArticleId=5120666

Eskom delays R54bn projects

August 12 2009 at 10:13AM

Electricity parastatal Eskom has put five projects, worth more than R54 billion, on hold as a result of its funding shortfall, Business Report said on Wednesday.

This raised the threat of future power crises, the newspaper said.

It quoted Cornelis van der Waal, a Frost & Sullivan energy analyst, as saying the project halts would reduce Eskom's spending, deepen South Africa's recession, cut opportunities in employment creation, and affect suppliers of cement, steel and other commodities.

Van der Waal said the cautious spending was aimed at helping Eskom focus on its priority projects.

Only three projects, Medupi, Kusile and Ingula, which together cost about R235-billion, would proceed.

According to Business Report, the Tubetse pumped storage project in Mpumalanga, worth R19-billion; Upington's 100 megawatt concentrated solar power plant, projected at between R2-billion and R6-billion; and the R3-billion 100 megawatt wind farm in the Northern Cape had been put on hold.

Also affected was the R1,8-billion Majuba rail venture and CIC Energy's R24-billion Mmamabula power project in Botswana, the newspaper said.

"Everything is on track at Medupi, Kusile and Ingula," Andrew Etzinger, Eskom's spokesman was quoted as saying.

"The government is committed to supporting these projects," he added. - Sapa

http://www.int.iol.co.za/index.php?set_id=1&click_id=124&art_id=nw20090812092448654C795158

Lesedi to build R150m manure-to-power plant in Heidelberg

By: Chanel Pringle, 21st August 2009
Independent power producer (IPP) Lesedi Biogas Project (LBP) is planning to build one of the world’s largest open-air feedlot manure-to-power projects in the world, in Heidelberg, near Johannesburg, it said this week.

The proposed power generation station, which would have a midmerit output rate of about 5,3 MW, would be completed within 18 months of the financial drawdown of the project and would likely be operational by about mid-2011.

LBP representative Nunda Naidoo said that the project would cost about R150-million to develop, assuming a R10/$ exchange rate.

He noted that the capital structure for funding the project would be finalised shortly, adding that this would involve the Central Energy Fund (CEF), the Industrial Development Corporation, the Development Bank of Southern Africa and LBP.

The project would be situated at the Karan Beef feedlot, with the beef and beef product supplier supplying all the manure from its feedlot to the IPP.

Karan Beef had initially agreed to supply LBP with 110 000 t/y of manure, which would result in the production of 3,8 MW of base-load power and 6,2 MW of peaking power.

However, the number of cattle at the beef supplier’s feedlot in Heidelberg has increased to 130 000 in recent months, which would result in additional manure.

The two parties were also negotiating for the procurement of tallow and paunch from the supplier’s abattoir, in Balfour.

The manure supply could increase to 140 000 t/y, with the overall supply increasing to 150 000 t/y if the tallow was included.

This would lead to an increase in the project’s size of between 30% and 80%, as tallow and paunch had higher gas contents than open-air feedlot manure, explained Naidoo.

A 30% increase in the project’s size would lead to 5 MW of base-load power and 8 MW of peaking power, with a 6,9 MW midmerit rate, while an 80% increase would allow for the production of 6,8 MW of base-load power and 11,2 MW of peaking power, with a 9,6 MW midmerit rate.

Naidoo said that the company intended to sell the power to State-owned power utility Eskom under the renewable energy feed-in tariff (Refit) agreement with the National Energy Regulator of South Africa (Nersa).

The regulator, in March, announced the Refit tariffs for wind, minihydro, landfill gas and concentrated solar power projects, with 20-year power purchase agreements (PPAs) to be signed with Eskom.

In July, Nersa had initiated a process to look into the inclusion of other renewable energy technologies, including solid biomass and biogas projects, as phase two of the Refit programme.

“Discussions are under way with Nersa and Eskom about the tariff and basis of sale,” commented Naidoo.

He added that LBP would prefer to supply the power utility with replacement peaking power for 15 hours a day and base-load power for nine hours a day.

LBP has already applied for a licence to operate the power plant and was expecting this to be approved in the next month or two, said Naidoo.

A feasibility study, partly funded by the CEF, had already been concluded, while an environmental-impact assessment (EIA) had also been completed.

The company was still awaiting a record of decision from the Department of Environmental Affairs regarding the EIA.

The generation plant had an estimated life of 30 years, with Naidoo explaining that, “The project will use a mesophyllic covered lagoon technology for the digester and a low-revving internal combustion engine with long-cycle times of 24 000 hours coupled to alternators."

Operating and maintenance costs would likely amount to between R15-million and R20-million a year, which would include provision for the overall maintenance of the engines every three years.

Meanwhile, LBP was also considering potential future expansions of the project, while additional future fuel sources could include municipal sewage and other vegetation.

Naidoo said that the timing and scale of future expansions would depend on certainty around the Refit and the signing of a PPA with Eskom.

He emphasised that funding remained one of the key challenges to the development of the renewable energy sector.

“Unless a clear and enforceable mechanism of cost recovery and tariffs are addressed, we as a country have no effective renewable energy policy to speak of. This is of concern to investors, technology suppliers and project developers,” he noted.

Naidoo added that, in LBP’s view, the renewable energy sector remained a “feel good” sector, rather than a sector that had to be developed with focus and priority to reduce the country’s carbon footprint.

Edited by: Mariaan Webb

Eskom 'won't learn from crisis'
2009/08/27 05:43:00 PM

Cape Town - The "shocking" R9.7bn loss posted by Eskom this week was the result of years of bad management, the Cape Chamber of Commerce said on Thursday.

In the five years before the blackouts started, Eskom made a profit of R33.5bn, said chamber director Albert Schuitmaker.

Most of that money had gone to the government in taxes and dividends instead of being used to improve maintenance, train staff and preserve coal stocks.

Now the picture was one of declining reserve margins of electricity, while stocks of coal were run down to the point where the country had been plunged into darkness.

"Eskom produced some great balance sheets, but it is now clear that they concealed more than they revealed," he said.

Some people were trying to blame the National Energy Regulator of South Africa (Nersa) for limiting electricity tariff increases in the boom years.

"But how could Nersa approve bigger price increases when Eskom profits were R9.458bn in 2007, R6.647bn in 2006, R7.786bn in 2005 (a 15-month financial year), R5.276bn in 2003 and R5.454bn in 2002?" he asked.

The chamber would like to believe Eskom had learned from the crisis, but there was reason for serious doubt.

- Sapa

R2.5bn gas facility proposed for West Coast

August 31, 2009 Edition 2
CRAIG MCKUNE
THE West Coast could soon be home to an offshore gas delivery platform, an onshore gas treatment plant and 225km of pipelines to carry the fuel to businesses.
Nersa, the national energy regulator, has advertised the holding of a public hearing on an application by private company Gigajoule Africa for a licence to construct transmission and distribution facilities and to trade in natural gas in the region.
The facility would cost R2.5 billion and could be fully operational by 2014, should the licence application and environmental impact assessment go smoothly.



Gigajoule spokesman Johan du Toit confirmed the company was considering building the facility at Saldanha Bay or Atlantis, but said it was too early to give details.



He said Consol Glass, Corobrik and ArcelorMittal had shown an interest, and formal objections had been lodged by Sasol and the parastatal iGas.
Although the public hearing was advertised as being set down for September 3 in Pretoria, it had been postponed until later in the month, said Nersa spokeswoman Ryna Boshoff. She could not say whether it would be held in Pretoria or closer to the target site.



According to Gigajoule's managing director, Johan de Vos, marine compressed gas would be sourced from the Kudu gas field off the Namibian coastline or liquefied natural gas would be bought from international suppliers.



Ocean-going tankers carrying the gas would moor at a buoy offshore from the processing plant and the gas would be piped ashore, treated, and distributed to clients through 225km of pipelines. A second phase would see the building of another pipeline to supply customers inland.

De Vos said the Kudu gas field would be able to deliver compressed natural gas to the West Coast region and Namibian market for about 10 years.
"Depending on the client consumption profile, the distance the gas will have to be transported and other factors, it will be competitively priced (in relation) to fuels currently used by those industries, which will convert to gas."



Natural gas was cleaner than other fuels, De Vos said.
"Carbon emissions will be substantially reduced and sulphur oxides and suspended particulates that are associated with fuel oils, diesel, coal and paraffin will be reduced to virtually nothing for customers."
Peet du Plooy, trade and investment adviser for World Wide Fund for Nature SA, confirmed natural gas was a cleaner fuel source. But as it was in limited supply and a greenhouse gas emitter, it was seen as an interim strategy in addressing climate change.



"The reality is that there is not a lot of it, but it is an improvement."
craig.mckune@inl.co.za

SA will need 20 gigawatts of new power by 2020

Power supply will remain tight in next 5-10 yrs
September 7, 2009

South Africa will need 20 gigawatts (GW) of new power generation capacity by 2020 and would require double that amount a decade later to meet rising demand, the country's power utility said on Monday.

But the utility's current expansion projects and power to be supplied by independent power producers (IPPs) would provide only just over 14 GW by 2017 towards that requirement, it added.

Current installed generation capacity in South Africa, including imported power, amounts to 43.5 GW.

"We have a very tight supply-demand balance and it will continue like that in the next five to 10 years... the situation has improved, but there are still risks," said Kannan Lakmeeharan, Managing Director at the utility's system operations and planning division.

He said the projections took into account the fact that Eskom will start to decommission old power stations from 2023.

Eskom has been rationing electricity since early last year when the national grid nearly collapsed, forcing mines, smelters and manufacturing plants to shut temporarily and costing the biggest economy in Africa billions of dollars.

The utility has embarked on an ambitious R385 billion new power expansion programme, but would need further investments to cover the gap between supply and demand.

Eskom said a third new power station would be needed by 2017 in addition to the two coal-fired power stations currently under construction. The two stations are meant to supply an additional 4 800 megawatts each.

The third station or a series of smaller plants could be built by Eskom or IPPs.

"This decision (on the third plant) will have to be made in the next year to ensure that water and transmission network infrastructure is built in time to commission this capacity by 2017," Lakmeeharan said.

To fire its power stations, the utility will require 180-200 million tonnes of coal a year from 2018, up from 120-130 million tonnes at the moment, it said.

Lakmeeharan said the utility was highly confident it would be able to supply enough power for the 2010 FIFA World Cup and would minimise maintenance during that period to avoid outages. - Reuters

http://www.busrep.co.za/index.php?fArticleId=5154963

Belgium company plans R1,2bn Eastern Cape wind farm


By: Esmarie Swanepoel
11th September 2009

Belgium’s largest renewable energy producer, Electrawinds Belgium, is planning to build a R1,2-billion wind farm in the Coega Industrial Development Zone (IDZ), in the Eastern Cape.

The company is currently finalising a feasibility study for setting up the commercial wind farm, the Coega Development Corporation (CDC) announced on Friday.

The wind farm project would see about 25 wind turbines, of 2,3 MW each, being built in the Coega IDZ.

The project would be fully operational by 2011, but Electrawinds plans to have the first turbine in place by May next year – before the start of the FIFA World Cup.

Electrawinds has appointed the Council for Scientific and Industrial Research (CSIR) to conduct the environmental-assessment study for the project.

“The single wind turbine and wind measuring mast in phase one require that a basic assessment is undertaken, with this process having commenced in August,” said CSIR environmental assistant Paul Lochner.

Energy Minister Dipuo Peters recently said that South Africa seeks to commission 400 MW of wind power by independent power producers within the next three years.

The country has a target of installing 10 000 GWh of renewable energy capacity by 2013.

RENEWABLE ENERGY SKILLS POOL

Meanwhile, Electrawinds announced that it would offer educational scholarships to top local students who were interested in furthering their studies in renewable energy.

“We want to invest in both turbines and people. We want to give young people in the region a chance at the right education so that, in time, they will be able to monitor our projects in South Africa,” said Electrawinds business development director Jan Dewulf.

He said that Electrawind would fully manage the training programme and would also be responsible for selecting the students, in consultation with the CDC.

These students would be referred to South African universities that offered suitable programmes and for those who wish to specialise further there was a postgraduate programme offered in Europe.

Emil Unger who represents Electrawinds in South Africa said that the implementation of the education programme would ensure that the country had a pool from which to draw qualified renewable energy specialists, something that currently did not exist.

World Energy Council praises SA's electricity achievements
Tuesday, 13 October 2009
The World Energy Council has commended South Africa’s great success in increasing access to electricity since 1994.


Improving access to electricity: Eskom electricity pylons in the Free State
According to the 2009 World Energy and Climate Policy Assessment, “while South Africa does not lead with a high indicator of the energy equity building block, its policies and their recent evolution and implementation are well worth considering by others”.

The London-based Financial Times mentions South Africa as one of the unexpected stars of this assessment, for the improvements that access to electricity has made to the population’s quality of life.

The report mentions that electrification in urban areas in South Africa has risen from 36% in 1994 to 90% at present. The number or rural households with electricity has risen from 12% in 1994 to 52% in 2005.

In order to achieve this, the assessment states that “a connection had to be made every 30 seconds for 5 years. A pole had to be placed in the correct position every 10 seconds. Two hundred metres of cable had to be strung and attached every minute.”

The increased access to electricity has lead to improved quality of live, better security and more business opportunities. The report also mentions major health benefits, including fewer paraffin burns and poisoning, vaccine refrigeration, water pasteurization and a decrease in respiratory disease.

According to the assessment, the achievement of 1.5 million connections in 5 years accompanied by a 50% reduction in costs was made possible by detailed planning, design and project management.

The assessment notes effective South African energy policies, for other countries to emulate. These include highly developed energy infrastructure policies and the implementation of renewable feed-in tariffs (that should encourage the use of renewable energy).

The World Energy Council also highlighted the country’s introduction of carbon emission reduction credits and the development of a carbon storage atlas, which will map areas of South Africa suitable for storing carbon emissions.

Over 90 member committees of the World Energy Council and their constituent members conducted this assessment of their energy policies and practices. The assessment will be done yearly to accelerate the move toward global energy equity and security, as well as environmental sustainability.

“It is critical in a time of great change to identify and benchmark policies and to distinguish successful and less effective policies. We need to ensure that our thoughts and actions can shape the new world of energy and build a path to a more sustainable energy future,” said Christopher Frei, Secretary General of the World Energy Council.

For the full report, visit the World Energy Council website.

Eskom wants 45% tariff hike
2009/10/13 10:46:00 AM

Johannesburg - Electricity parastatal Eskom wants a 45% tariff hike every year for the next three years.

This is according to its Multi Year Price Determination submission document to the National Energy Regulator of SA which was handed to the media before a briefing in Johannesburg on Tuesday.

There were other options, but Eskom recommended this option be considered as it "mitigates the impact of price increases on customers and the economy and provides for a sustainable long-term solution".

The parastatal said government had endorsed this approach which was based on the smoothing of price increases.

The second option, not recommended by Eskom, was an increase of 146% in the first year of the Multi Year Price Determination period.

- Sapa

Eskom hikes will torture SA
2009/10/11

Johannesburg - Economic growth will be one to two percentage points a year lower if Eskom?s proposed tariff increases of between 45% and 66% over the next three years get the green light, according to econometric analysis by the University of Pretoria (UP).

Tariff increases such as this will heavily impact investment, job creation and sectors like mining, manufacturing and construction, it said.

Last week, the Reuters news agency reported Eskom was planning enormous hikes in its tariffs, although the power utility has said it's unsure if this would be supported by government.

Reyno Seymore, a researcher at the African Institute for Economic Modelling (Afrinem) at UP, said increases of 45% or 66% a year for three years will not only put tremendous pressure on the inflation rate, but could also sharply cut back the economy's potential growth.

A 45% tariff increase could add 0.8 percentage points to the inflation rate next year, and one of 66% about 1.2 percentage points.

The economic growth rate could decline dramatically, since increased expenditure on electricity would seriously impact consumer demand, and at the same time render many investment projects in the private sector, in particular, unprofitable.

Seymore said a hike of 45%, if introduced at the beginning of the year, could result in the economy growing up to 1.3 percentage points less next year than it would without the increase.

A 66% escalation could reduce economic growth by 1.9 percentage points.

Seymore said that Eskom was on the horns of a dilemma.

The electricity provider needs massive tariff hikes to fund its R385bn expansion plans, but these tariff hikes could reduce electricity demand to such an extent that the utility would not generate sufficient income to finance its expansion plans.

Tariff increases of this magnitude will however hurt investment the most. Investment growth could fall 10 percentage points in the case of a 45% rise, and almost 15 points if tariffs are upped by 66%.

In particular, demand for unskilled labour would be considerably down, said Seymore. He estimated that growth in unskilled employment could shrink by 3.3 percentage points in the case of a 45% hike, and 4.7 points if the hike is 66%.

Even experts and the professionals will be impacted in the form of smaller salary increases - heightening the possibility of emigration.

Seymore said salary increments could be 2.7 to 4 percentage points lower, depending on the size of the tariff hike.

- Sake24.com

Eskom must 'call on World Bank'
2009/10/14 11:04:00 AM

Johannesburg - If power utility Eskom, in conjunction with or without government, is unable to raise sufficient capital on the debt market, there is then a strong case for a loan from the World Bank, said economist from Investec, Annabel Bishop, on Wednesday.

"A sufficiently large enough loan, correctly spent, will place SA on the trajectory for growth of well above 6% - we estimate growth of above 8% is needed to increase employment sufficiently to reduce unemployment.

"This should be incentive enough to approach the World Bank, instead of going the alternative route and reducing SA's competitiveness by implementing immense and ever-growing electricity price hikes," she says.

The economist notes that an ever-increasing financial burden is being placed on the dwindling taxpayer base.

"SA's proposed health and welfare policies borrow heavily from developed countries and, as such, are often not SA appropriate. The proposed NHI will further add to the financial burden on the taxpayer, along with the electricity tariff hikes, further reducing SA's level of competitiveness and employment creating potential."

She notes that Eskom clearly needs finance to both cover its operational costs and fund its infrastructure spend.

"The biggest cost is capital expenditure, which we estimate at R1.25 trillion to 2025. The SA private sector will never be able to finance the entire bill through an increase in electricity tariffs, nor should they.

Infrastructure is financed through borrowings, operational costs through revenue," says Bishop.

The impact on inflation if the proposed tariff increases are implemented will be severe and ongoing, preventing the consistent attainment of the inflation target and casting doubt over the validity of the entire inflation- targeting process.

"Higher interest rates will never be able to push down the cost of electricity prices and will, instead, just add to the financial burden faced by the private sector in doing business in SA," says Bishop.

"While we expect another 50 basis point cut in interest rates at the October MPC meeting, the Sarb may decide against this due to high electricity prices threatening the medium-term attainment of the inflation target."

Nuclear to reduce long-term capital costs
9th October 2009

Fluctuating coal prices, transportation and transmission costs, as well as future carbon tax penalties are risks to South Africa’s energy generating future, says South African nuclear technology company the Pebble Bed Modular Reactor (PBMR) Company.

“The challenge facing the local nuclear energy industry is that the initial capital costs are higher compared with the capital costs of fossil fuel plants. 
“However, the long-term benefit is that the maintenance and operation of a nuclear plant and the cost of the nuclear fuel are considerably lower. 
“The opposite is true for fossil fuel plants, where the initial capital cost is lower, but the long-term costs are high.
“When one considers elec-
tricity generation, one must consider the long-term implications. 
“If one only considers short-term implications, it will result in getting caught with long-
term cost factors,” says PBMR Company international marketing manager Gert Claassen.

He adds that most countries battle to raise the initial capital to build nuclear power plants, which can provide significant lower-cost benefits for more than 40 years. 
The result is that countries revert to short-term solutions of using gas and coal. 
However, this can have a costly impact on electricity generation in the long term as fuel costs rise, he explains.

In highlighting the cost differentiation, PBMR Company communications consultant Tom Ferreira notes that State-owned power utility Eskom’s open-cycle gas-turbines, which run on diesel, cost 78 times more to run for every megawatt generated than State-owned power utility Eskom’s nuclear power station, Koeberg.

“The reality is that the cheapest way to generate electricity is to have a coal-fired plant on the site of a high-quality coal mine. 
“The moment the coal needs to be transported, the costs increase. 
“If the coal is not of high quality, the economics also change. If the plant is far and transmission lines have to be built, the costs increase again,” says Claassen.

Ferreira adds: “To build a transmission line from the Medupi power station to Cape Town will cost about R8-billion, not taking into account the transmission losses along the way.”

Claassen explains that, assuming certain economic growth rates by 2030, South Africa will need to double its generating capacity and ideally one-half of that requirement should come from nuclear. 
“South Africa needs every type of energy resource that it can gather and there is a place for renewable energy. 
“However, renewable energy 
will never be able to provide the baseload that the country needs, nor will it be able to maintain it, although is can make an important contribution to the whole energy cycle,” he says.

Claassen reports that, because of economic realities, South Africa needs a balanced energy portfolio that includes both coal and nuclear, partic-ularly in coastal areas because of transmission lines, as well as some renewable energy that can be used in local areas. 
This is a balanced mix that is significant as clean energy sources become a require-
ment.

Despite Eskom’s decision to suspend Nuclear-1 at the end of last year owing to high costs, the company acknowledged, at a results presentation in August, that nuclear energy was still the biggest opportunity for the company to limit its carbon dioxide (CO2) emissions. 
The company generated 221,7-million tons of CO2 in the 2009 financial year and believes that nuclear and renewable-energy projects would play a major part in reducing its emissions. 
Claassen adds that the cost of carbon emissions will become a significant factor in future, particularly when carbon taxes come into effect.

“Nuclear energy has a significant role to play in electricity generation in South Africa. However, the decision on the future of South Africa’s nuclear programme now rests with government,” he concludes.
Edited by: Brindaveni Naidoo

Framework in place for one-million-solar-water-heater vision, but funding plan needs firming


By: Christy van der Merwe
20th November 2009

The next six months will see a watershed of activity in the solar water heating industry, as role-players gear up to meet the target of rolling out one-million solar water heaters (SWHs) by 2014, which was reaffirmed by Minister of Energy Dipuo Peters, in October, in her medium-term Budget speech.

The longer-term target, which is vital in stimulating downstream manufacturing and installation capability, is 50% penetration of SWHs in the residential sector by 2020.

The Department of Energy (DoE) will present the final SWH strategic framework to the Minister on December 4, 2009, with the aim of launching and implementing the strategy by April 2010.

This came after inputs and written comments on the draft SWH strategic framework – presented to stakeholders at a workshop on November 5 – were received from relevant parties by the November 20 deadline.

The draft SWH framework has evolved from an initial workshop with stakeholders in the first half of the year, where the key issues identified were policy targets and support, financing, standards implementation, and manufacturing and supply capacity.

Since then, the target of one-million SWHs has been reiterated and, at the most recent workshop, DoE acting deputy director-general for electricity Ompi Aphane explained that the electricity tariff would be the source of funding, although Eskom would not be responsible for managing the funding.

“An increase in the electricity tariff to support the roll-out of SWH’s is far more justifiable than the significantly greater increase required for covering the capital cost of even more coal power. Not only are solar geysers a more cost-effective, environmentally responsible and job-intensive means to bridge the electricity supply-demand gap, it also gives us breathing space to delay or even defer costly projects like Kusile,” says World Wide Fund for Nature (WWF) South Africa trade and investment adviser Peet du Plooy.

The workshop also unearthed acknowledgements that the Eskom rebate for SWHs did not have the desired effect in stimulating the uptake of units in the South African market, hence the need for more strategic and coordinated plans. Stakeholders complained of chronic late payments from the utility when it was in charge of the subsidy scheme.

Based on current initiatives and industry levels, it would take more than 15 years to reach the one-million-SWHs target, or 75 years to reach 50% market penetration – hence, the need for increased impetus and robust supporting frameworks.

The recently presented draft framework “is a complete shift from a fragmented low-volume high-cost industry to a coordinated utility mass roll-out paradigm”, explains Development Bank of Southern Africa renewable-energy market transformation project coordinator Yaw Afrane-Okese.

National SWH Entity
The draft framework recommends the creation of a national SWH entity, under the Public Finance Management Act (PFMA), to enact national SWH policy as well as funding arrangements, and orchestrate the delivery to currently unserviced residential market sectors.

The entity will be a single point of account- ability for stakeholders in achieving the national SWH plan in defined market sectors. It will need to be clearly defined to ensure that its establishment takes place within the short period of time defined.

A public SWH delivery entity at national level will be accountable to three sets of stakeholders, namely investors, the licensing authorities and the consumer.

It will serve specifically defined market sectors, particularly those not currently benefiting from the roll-out of SWHs. It will best serve the interests of low- and middle-income householders and ensure effective orchestration of bulk buying, highly affordable systems, skills training, deployment of private- sector subcontractors, and that subsidies reach households.

It is also viewed as important that the utility has the right to obtain and allocate revenue from carbon offsets, demand-side management (DSM) and other revenue streams to achieve the national SWH plan.

Energy solutions company Unlimited Energy director Duncan Abel explains, “Carbon funding is not the silver bullet that will drive the mass roll-out of SWHs, but it is an important component of a coordinated national roll-out to be driven by both government and the private sector.”

The key aims of the national entity are to ensure affordability by procuring low-cost, best-quality systems through bulk buying and large contracts with quality assurance; to obtain and manage funding streams; to rigorously manage the supply chain; to ensure large-scale project management and disciplined deployment of numerous subcontractors; to protect consumer rights and interests in terms of events such as flooding or repairs; and to be accountable to government, funding bodies and consumers.

Funding Concerns
Responsible for presenting the draft framework at the workshop on November 5, Afrane-Okese says that, despite a few concerns being raised by stakeholders, the framework has been well received.

The concerns flagged were the funding model, particularly considering past experiences with Eskom in charge of the subsidy scheme; complicated monitoring and verification; and the need to ensure local manufacturing as part of the mass roll-out programme.

Afrane-Okese adds that final agreements on the business case and funding streams are in process, although a basic approach has been outlined. Minimal National Treasury support will be required, and it is hoped that the large-scale roll-out will reduce costs.

The framework states that the national SWH entity will need to be a self-sustaining one, with individual programmes to ensure that costs equal income, and that cash flow funding will fill the gap between the timing of expenditure and subsidy income.

This basic approach includes self-funding programmes, where costs could be covered by a subsidy plus a customer contribution. Prices will also be ‘stepped’ to be highest level for upper-income homes and to the lowest level for poor households, with a new entity to deliver to the middle- and low-income market.

Primary sources of funding will be the standard offer based on electricity savings; programmatic Clean Development Mechanism funding, which will be centrally coordinated to ensure adequate scale; and other small funding components, such as support for the indigent. In terms of funding for local manufacture, the national SWH entity will turn to the Department of Trade and Industry (DTI) to provide incentives.

Also, initiatives such as the one recently announced by the Department of Environ-mental Affairs – a $500-million ‘infusion’ through the Clean Technology Fund (CTF), which sought to scale up grid-connected renewable energy, SWHs and energy efficiency – will play a role. Environmental affairs director-general Joanne Yawitch explains to Engineering News that the fund will support the roll-out of SWHs as it will provide lines of credit for local banks to stimulate manufacture and installation capacity, making it easier for the private sector to access funds for clean technology investment.

The CTF is part of the Climate Investment Funds, being implemented in South Africa jointly by the African Development Bank, the International Finance Corporation and the World Bank.

Universal Access
Sustainable Energy Society of South Africa SWH division chairperson Dylan Tudor- Jones explains that the current geyser market is about 400 000 units a year, which excludes old housing stock and low-income housing.

Providing universal access to modern, affordable and environmentally beneficial SWH services for all households in South Africa on an equitable basis is a key focus of the strategic framework. The programme hopes to stimulate accelerated water heating service delivery, particularly to low-income and indigent households by using renew-able-energy sources.

The programme is seg-mented by a total of six emerging major market groupings – each requiring different solutions. These are first-tier or upper-income residential retrofits of existing electrical geysers; second-tier or middle- to low-income electrical geyser retrofits; third-tier residential retrofits or delivery of SWHs to homes with no existing geyser; fourthly, new-build homes, both upper- and middle-income homes and affordable housing; the fifth level replacing failed electrical geysers; and, finally, industrial and commercial SWH systems in both the public and private sectors.

Different approaches for each of the six divisions have been put forward.

Must-Haves to Meet Targets
A number of supporting activities will need to take place to ensure targets are met.

Key policy interventions required are an integrated national SWH policy from govern- ment; target setting by Cabinet with non- negotiable delivery; mandating of the national utility; and role clarity between shareholders, Ministers and providers.

Regulatory and legal matters to be taken care of include setting up the national SWH entity under the PFMA; the drawing up of SWH market rules by the National Energy Regulator of South Africa; national building codes and regulations alignment, as well as appointing local authority building inspectorates for SWH approvals and bylaws; and new-build and refurbishment geyser replacement legislation.

To create a sustainable SWH market, DTI inward investment will be required to boost local manufacture through fiscal investment incentives. The national SWH entity procurement will also need to include an increasing locally manufactured uptake clause.

Skills development, training and capacity building are also important to ensure the meeting of the targets. The Department of Labour will be responsible for skills training facilitation and accreditation, and large installation contractors will be required to undertake certain training responsibilities. An increase in support to entrepreneurs will also be necessary, and the existing SWH industry will need to support upper-income training initiatives.

Tight Timelines
It is envisaged that, by the end of January 2010, a detailed implementation plan will be complete, as well as standards and moni- toring and verification protocols finalised, and, in February, the Minister will issue a section 34 determination, or integrated resource plan, and set the target of one-million SWHs by 2014.

By the end of March, a national energy services company or body will be clarified.

Once launched in April, manufacturing tendering will go out, with the national body inviting tenders under an independent system operator, and covering implementation, marketing, sourcing, installations, maintenance, financing and so on.

Installation of the units in targeted areas will continue with greater focus on local manufacture. The target to be reached by 2014 is one-million SWHs and, by 2020, it is hoped that a further four-million units will be rolled out.

There is certainly much work to be done in a short space of time; however, Peters has reiterated that, considering market penetration potential and the enthusiasm of industry players, the target is “easily attainable” and, in fact, the industry could do more to exceed the target.

WWF SA has commended the launch of the draft framework, which, it says, sets the groundwork for the roll-out of the programme; however, the organisation adds that increased urgency and action are needed if the programme is to realise its full potential for improving energy security and unlocking jobs and industrial growth.

Wind energy is great for the feel good thing about the environment. But to supply adequate power to industry and all the growing households, only three methods are viable in SA. Nuclear, Hydro or Coal. Anything else will be minute.
I have to say there is an alternative solutions to new alternative energy......will share this in about a weeks time, however we will need the publics support to (I mean the man in the street) take this new concept to fruitation!

World Bank approves 3.75 billion dollar loan to support South Africa's energy security plans
WASHINGTON, April 9 (PNA/Xinhua) -- The World Bank on Thursday approved a 3.75 billion dollar loan to help South Africa achieve a reliable electricity supply while also financing some of the biggest solar and wind power plants in the developing world.

The loan the World Bank's first major lending engagement with South Africa since the fall of apartheid 16 years ago aims to benefit the poor directly, through jobs created as the economy bounces back from the global financial crisis and through additional power capacity to expand access to electricity.

The loan is provided to South Africa's power utility, Eskom, and was brought about by unique circumstances including South Africa's energy crisis of 2007 and early 2008, and the global financial crisis that exposed the country's vulnerability to an energy shock and severe economic consequences, according to the World Bank.

"Without an increased energy supply, South Africans will face hardship for the poor and limited economic growth," said Obiageli K. Ezekwesili, World Bank Vice President for the Africa Region.

"Access to energy is essential for fighting poverty and catalyzing growth, both in South Africa and the wider sub-region. Our support to Eskom combines much-needed investments to boost generation capacity for growing small and large businesses, creating jobs, and helping lay the foundations for a clean energy future through investments in solar and wind power."

In approving the project, the World Bank Board of Executive Directors noted South Africa's achievement in increasing energy access from around 30 percent of citizens to more than 80 percent since the fall of apartheid in 1994 and noted its Free Basic Electricity policy that provides 50 kilowatt hours (KWh) of free electricity per month to poor families.

The Board noted South Africa's pivotal role as generator of 60 percent of all electricity consumed on the African continent and the importance of a functioning electricity sector for job creation, economic progress, human welfare, and poverty reduction.

However, the United States, the biggest shareholder of the World Bank, abstained in the vote, citing that it has concerns about "the significant greenhouse gas emissions" the power utility would produce.

Without measures to offset carbon emissions, "the projects are incompatible with the World Bank's strategy to help countries pursue economic growth and poverty reduction in ways that are environmentally sustainable," the U.S. Treasury Department said in a statement.

Earlier this week, World Bank President Robert Zoellick defended the proposed loan to South Africa, saying it would be hard to deny help to a developing country as it emerges from a crisis "sparked by conditions in the United States and the developed world."

"Coal is still the least-cost, most viable, and technically feasible opinion for meeting the base load power needs required by Africa's largest economy," Zoellick said, noting that the power plant would use efficient "supercritical" technology, enable electricity sales to neighboring countries and help avoid the power shortage that plagued South Africa in 2008.(PNA/Xinhua)http://www.pna.gov.ph/index.php?idn=3&sid=&nid=3&rid=268782

Sigh...very bad move.

Yeah....

I was kind of hoping the World Bank would at least be intelligent.

US, UK, Dutch abstain from voting on WB loan to SA
WASHINGTON, April 9 (PNA/PTI) -- The United States, Britain and the Netherlands abstained from voting for a US$ 3.75-billion World Bank loan for building a coal-fired power plant in Africa because of their concerns about its adverse climatic impact.

"This reflects concerns about the climatic impact of the project and its incompatibility with the World Bank's commitment to be a leader in climate change mitigation and adaptation," the US Department of Treasury explained in a statement after it abstained from the voting by the World Bank Board of Directors.

Noting that the United States recognizes South Africa's pressing energy needs and the lack of near-term feasible low-carbon alternatives, the Department of Treasury said the Obama Administration is concerned about the project since it would produce significant greenhouse gas emissions while there is considerable uncertainty about future mitigation efforts. (PNA/PTI)http://www.pna.gov.ph/index.php?idn=3&sid=&nid=3&rid=268908

Eskom faces fire over R10 billion in back payments
April 20, 2010

By Donwald Pressly

Top executives from Eskom are set to appear before parliament’s public enterprises portfolio committee to answer why nearly R10 billion is owed to the state-owned power entity in back payments.

This R10 billion was outstanding at the end of June 2009, according to a document in Business Report’s possession, and includes about R1.2 billion owed to Eskom by its international clients and about R450 million which have “special (pricing) arrangements” with the entity.

The amount outstanding represents almost 19 percent of Eskom’s revenue in its last financial year ending March 2009 when the utility generated R53.8 billion in revenue.

Eskom chairperson Mpho Makwana and senior staff are expected to answer questions at the committee ton Tuesday chaired by fiery ANC MP Vytjie Mentor.

Eskom itself has reported that Soweto owes near R2 billion in back payments, while a company called Motraco, which is a joint venture between Swaziland, South Africa and Mozambique – which itself supplies about 95 percent of the BHP Billiton’s aluminium plant, Mozal, in Mozambique – owed about R100 million.

DA MP Pieter van Dalen said it was deeply puzzling that the Soweto debt continued to build up with about R1.8 billion of it owed for 60 days or longer and about R57 million of it for more than 15 days over due payment date.

Van Dalen said about 10 percent of Eskom’s entire capacity of 53 000 gigawatt hours in the quarter ended June 2009 was supplied to the three aluminium plants, through Billiton’s Hillside and Bayside plants in South Africa and Mozal.

An Eskom sales document shows that Johannesburg’s City Power used some 3 300 gigawatt hours per year (GWh) in in the first three months of 2009/10, Billiton’s Hillside and Bayside plants used just short of 3 000 GWh, Durban’s Metropolitan area 2 700 GWh, the City of Tshwane Metropolitan area 2.250 GWh, Motraco – which Eskom noted was an international customer – just short of 2 000 GWh, Sasol Synthetic Fuels 1 808 GWh, Ekurhuleni Metro used 1 800GWh, the City of Cape Town 1 631GWh, Nelson Mandela Metro 949 GWh and AngloGold Ashanti 843 GWh. These were the 10 biggest customers.

Revenue from these was just short of R17 billion while other international customers made up R1.2 billion and “the rest of Eskom” R34.8 billion – with total revenue amounting to R53 billion in the three months, down slightly from R55 billion the previous year.


While Billiton’s Hillside and Bayside plants paid R451 million for their power in those three months, this was down from R724 billion for the corresponding period of the previous year.

This was the result of the fluctuating price of aluminium. Motraco’s costs did not fluctuate – it paid just R252 million for 1 959 GWh in the three months of 2009/10 up from just R235 million for slightly less power usage of 1 957 GWh in the corresponding three months of 2008/09.

Van Dalen said questions needed to be asked of the Eskom management about this deal with Matraco.

While Public Enterprises Minister Barbara Hogan last week said the special deals with the aluminium companies needed to be renegotiated as they were legacy deals, Van Dalen said the Motraco deal had been struck in 2000 “well into the post-apartheid period”. In addition Motraco had been provided R224 million in guarantees.

He said that it was paying about 12 a kilowatt hour, about a third of what Eskom’s chief operating officer of generation Brian Dames said was the cost price of 33 to 34 c a kilowatt hour. Billiton was paying about 24c to 26c. “There are a lot of questions to be asked and difficult answers sought from Eskom.”

Last week public enterprises deputy director general Chris Forlee said many of the special deals could not be made public owing to their commercial sensitivity.

Van Dalen wondered why SA was continuing to supply Motraco, on whose board Eskom has two board members and which showed about a R4 billion profit last year, when it appeared not to be paying its bills. “The amount of power it is using is about what is supplied by Koeberg. We can save 1 900 GWh per year.”

In reply to a parliamentary question from Independent Democrats MP Lance Greyling, who asked how many companies received an “even lower and fixed tariff” – as Motraco appeared to get – than the so-called “mega-flex contract”, Hogan said Eskom only had two customers who had long term contracts and it had started the process of engaging the customers concerned “with a view to revising the contracts.”

“These contracts were entered into during the period when Eskom and excess capacity,” she said, adding that the request for her to name the companies “relates to confidential commercial information of a third party and is subject to the protection provided in terms of the Promotion of Access to Information Act.”

http://www.busrep.co.za/index.php?fArticleId=5435751&fSectionId=552&fSetId=662

Eskom's secret deal dossier exposed
April 21, 2010

By Melanie Gosling

A secret Eskom dossier has revealed that the electricity supplier has been supplying electricity to BHP Billiton at 12c a kilowatt hour - below the cost of electricity production.

The secret pricing deal with the multi-national company to power its massive aluminium smelters accounted for the bulk of Eskom's R9.5 billion loss last year.

Eskom has special secret price deals with BHP Billiton and Anglo American, which use nine percent of all electricity generated in South Africa.

This emerged during a meeting on Tuesday of the parliamentary portfolio committee on public enterprises, where Eskom executives made a presentation to MPs on the utility's controversial special pricing agreements.

While Eskom made their presentation, Democratic Alliance MP Pieter van Dalen sat in the front row with his arm on a thick blue ring-back file, marked in red on its spine: "SECRET/GEHEIM".

At question time, Van Dalen tapped his fingers on the file and said he had information that Eskom was selling electricity to BHP Billiton for 12c a kw/h. This was done via Motraco, a joint venture company between South Africa, Mozambique and Swaziland.

He added that his information was that the company's three aluminium smelters contributed a mere 0.1 percent to GDP and that BHP Billiton owed Eskom R100m. He said Eskom's price of 12c was a case of "giving electricity away" to BHP Billiton.

Asked by the committee chairwoman, Vytjie Mentor, about the file that he appeared to be referring to, Van Dalen said he could not hand it over to the committee because it was secret.

"Who made it secret?" she asked.

"Eskom itself," Van Dalen replied.


She ruled that Van Dalen was "out of order" for accepting the secret Eskom file.

Van Dalen said: "But if Eskom could say whether it is a lie or the truth."

"I'm ruling you're out of order... You should not tempt employees to give you secret information," Mentor said.

When it was Eskom's turn to reply to a list of questions put to them by the MPs, a sober-looking Makwana began: "I've just been informed of a form of crime with an MP, indicating a serious leaking of information out of our system. I will find out what I should do in that regard."

Later when ID MP Lance Greyling asked Eskom to confirm the 12c kw/h, Makwana replied: "I would prefer to respond in writing because it is more than face value. There are other components of value embedded in this contract."

Makwana told the committee that Eskom had reached an in principle agreement with BHP Billiton that would release it from the long-term tariff agreement. Attempts to renegotiate a similar contract with Anglo American was proving more difficult.

Makwana said "95 percent of the liability" had been eradicated with the agreement signed on March 31. Eskom hoped they would sign a binding agreement on May 27, once it had been subject to an audit.

The special low tariffs had been negotiated in a different era, prior to 1994, when there was a surplus of electricity.

The BHP Billiton electricity contracts were to supply electricity to its Mozal and Hillside aluminum smelters. Makwana said Eskom had been "held to ransom" by these agreements, which linked the electricity tariff to the aluminium price, which had dropped in the global economic crisis.

http://www.busrep.co.za/index.php?fArticleId=5438435

Eskom battles giants
Article By: Wed, 21 Apr 2010 08:23

Eskom has reached an in principle deal with BHP Billiton that will release it from an "onerous" long-term tariff agreement that triggered book value losses of billions last year, acting chief executive officer and chairman Mpho Makwana said on Tuesday.

However, attempts to renegotiate a similar contract with Anglo American to remove liabilities linked to embedded derivatives was proving more difficult.

Eskom finance director Erica Johnson said this was due to the recalcitrance of one of the parties to that contract, the Skorpion Zinc mine in south-western Namibia.

"There has been a bit of a challenge, Skorpion Zinc has been difficult to engage," Johnson told Parliament's portfolio committee on public enterprises.

Makwana said the contract with BHP Billiton to supply electricity to the mining giant's Mozal and Hillside aluminium smelters accounted for 95 percent of Eskom's embedded derivative liabilities that led to a book value loss of R9.5 billion last year.

He said Eskom had "been held to ransom by the long-standing liability" on derivatives that linked the tariff to aluminium prices, causing panic when these plunged in the wake of the global economic crisis.

The renegotiated contract with BHP Billiton was subject to audit and should be signed at the end of May, he said.

"On May 27, we will sign against that audit opinion."

A defensive Makwana declined to answer repeated questions from MPs on whether Eskom had been supplying power to BHP Billiton's smelters at below cost.

Johnson suggested this was the case when she explained that when Makwana termed the contracts "onerous" he meant that "we do not recover our cost of supply to them".

"We had to go and talk to the counterparties and say fundamentally this is onerous. Every single year we are going to be showing the volatility of embedded derivates on our financial statements."

Johnson said there was a major challenge in approaching the two companies because the contracts were binding and they were under no obligation to reopen negotiations.

BHP Billiton had nonetheless "willingly" agreed to renegotiate, she said.

Makwana informed MPs that for the current financial year, Eskom's generation costs came to 23.4 cents per kilowatt-hour and its production costs to 41.6 cents per kilowatt-hour.

He said he had the answers to their questions at hand, but would prefer to respond in writing because the issues were complex.

Inkatha Freedom Party MP Mario Oriani-Ambrosini tried to object, but was silenced by committee chairwoman Vytjie Mentor, whom he later accused of routinely seeking to censor briefings.

There were more fireworks when Makwana threatened to take legal action against Democratic Alliance MP Pieter van Dalen after he claimed to be in possession of a "secret" internal document showing that Eskom had been supplying power to the Mozal plant at 12 cents per kilowatt-hour.

Van Dalen also claimed that the severely cash-strapped electricity utility was owed R100-million on the contract to keep Mozal running.

Makwana refused to respond to the allegation and rejected notions that the company suffered a loss in real terms after aluminium prices tumbled.

He insisted that embedded derivatives would not have become an issue had international financial reporting standards not changed in the new millennium and forced the company to report long-term liabilities that would arise under the deal.

He said the terms of the long-standing contracts with the mining houses also had to be understood in the context of South Africa's political commitments "to empower our neighbours" under the New Partnership for Africa's Development (Nepad) launched by former president Thabo Mbeki.

"We are taking this at face value when in fact other components of value were embedded in this".

The deals with BHP Billiton and Anglo American have been blamed for Eskom's cashflow and supply capacity problems, with commentators saying the country's energy woes would be eradicated if the deals were cancelled.

Makwana said the two contracts accounted for just under 10 percent of South Africa's electricity consumption.

Public Enterprises Minister Barbara Hogan had put the figure at "approximately five percent" but the chief executive officer said this was because she was referring to their share of peak-hour consumption.

Hogan had consistently refused to divulge finer details of the deals, which were inked from 1994 onwards when South Africa had excess electricity supply and sought to sell power cheaply to attract investment.

The minister said indiscretion would make the country look "silly".


http://business.iafrica.com/news/2369522.htm

SAVE ENERGY, PRESIDENT ZUMA URGES SOUTH AFRICANS
PRETORIA, April 29 (NNN-BUANEWS) -- President Jacob Zuma has called on South Africans to save energy in an effort to avoid the load-shedding that plunged the country into darkness in 2007 and 2008.

In efforts to save the limited resource, the government is embarking on an initiative to implement the use of alternative forms of energy -- cheaper and cleaner forms which save money and the environment. Solar water heating is one such option that has many benefits as compared with other forms of water heating. Once installed, you have free hot water.

On Wednesday, President Zuma launched the Government's Solar Water Heating Programme in Winterveldt, which saw families in the area receive solar panels.

Reiterating that energy was not an unlimited resource and that people needed to work harder at conserving it, the president said: "We took energy for granted. Things have changed drastically.

"You will recall that the period 2007 and 2008 saw a number of noticeable disruptions in the electricity supply. Large sections of the country were plunged into darkness as a result of Eskom not being able to meet the electricity demand nationwide."

Wednesday's launch is in line with the government's target of installing at least one million solar water heaters by 2014 to reduce the water heating load on the national grid.

Winterveld was chosen as the site of the launch because of the fact that the people living in this area derived wealth from available natural resources such as land and are very innovative.

President Zuma said plans were afoot in the government to convert water heating for hospitals, clinics, prisons, barracks and other government buildings to solar water heating.
"You will see a lot of that happening in the next few years," he said.

Currently, 270 heaters have been installed in some homes in the area and phase two of the installation will supply at least 10,400 additional heaters in Tshwane this year. Phase three of the project, starting during 2010-2011, will target the whole country over a longer period.

"As we continue to look for other alternatives to save energy, let me remind all that we must continue to save electricity. We must switch off our appliances when they are not in use. Let us share this responsibility as citizens of this country and electricity users," said President Zuma.

Energy Minister Dipuo Peters said that residents were keen on having solar power heaters in their homes. "We know that after this launch. A lot of people who have started to see their neighbours having hot water in the morning while they are busy pumping their prima stoves, will want the same," she said.

She added that the advantage of installing solar heaters was that people would save money towards their electricity bill and that they will get rebates for installing it.

"We will be calling a press conference on how the standard offer relates to how you as an individual can save electricity and how you will be able to monitor it and make sure that you can be able to benefit from a particular rebate, "she said.

During the president's visit to the area, three houses that had been fitted with solar water heaters were visited including that of a disabled man.

Austin Maluleka a 36-year-old unemployed man was one of the recipients of a solar water heating system. The married father of two said that the heater, installed in November 2009, has made his life easier.

"We no longer have to boil water to bath; we use our electricity to cook. I no longer spend a lot of money buying electricity, our tap has hot water," he said. http://www.namnewsnetwork.org/v2/read.php?id=118485

Was just reading an article on iAfrica today :


Solar plant for SA
Article By: Fri, 30 Apr 2010 10:46
Solar boiler maker Areva Solar is ready to build a 100 megawatt concentrated solar plant in South Africa from next year, the Business Day newspaper reported on Friday.

It cited Tom Bartolomei, the French firm’s senior vice-president for business development as its source.

"Areva Solar is among several companies who are eager to establish a renewable energy industry in South Africa once the government has announced its long-term energy plans," the newspaper wrote.

Areva also wanted to get into South Africa's nuclear industry and it had been in the running for the contract to build Eskom’s second nuclear plant.

The project, however, was shelved in 2008, Business Day reported.

It quoted Bartolomei as saying that South Africa presented a strong concentrated solar market opportunity.

"South Africa is fortunate to have a strong solar resource."

Bartolomei said Areva Solar was prepared for the construction of a 100 megawatt plant between 2011 and 2012.

"The technology is ready," he was quoted as saying.

However, investments in renewable energy depended on the outcome of the integrated resource plan process.

The energy department has committed itself to releasing the plan by June.

Business pledges to add 5 000MW to grid
May 3, 2010

Business Leadership SA (BLSA), an association of SA’s largest companies, on Friday said its members could contribute an additional 5000MW of electricity to ease the country’s electricity supply constraints.

BLSA represents the 80 largest companies in SA, including multinationals and state-owned enterprises that collectively account for 75 percent of JSE’s market capitalisation. Its members are among the country’s biggest electricity users.

BLSA’s announcement comes a week after Business Unity SA (Busa) also said its members could add 5000MW to the national grid through energy savings.

Speaking after the BLSA’s board meeting on Friday, executive committee member Jayendra Naidoo said the prospects of rising electricity demand and the pressure on electricity supply created the need for additional capacity and better usage of electricity.

The additional capacity of 5000MW could be achieved through a combination of members’ co-generation activities of their members, independent power producers “and a number of initiatives to save electricity,” he said.

Naidoo said priorities included ensuring adequate supply of electricity and funding for the additional 40000MW of electricity capacity SA needed by 2030, he said.

Eskom’s Medupi and Kusile coal fired power stations would cover less than 20 percent of the new capacity. The surge in electricity demand would continue to put pressure on the country’s reserve margin — the ratio of installed capacity to peak load. SA’s reserve margin has been estimated at 8 percent, well below the accepted global norm of 15 percent.

Meanwhile, BLSA chairman Bobby Godsell denied tensions between the association and Busa, SA’s umbrella body for business. “BLSA is not in conflict with Busa. Busa is an umbrella body (while) we unashamedly represent big companies,” Godsell said.

Godsell also denied President Jacob Zuma had snubbed the association. He said interactions with government were good. He and Naidoo, however, stressed that meetings with government should be based on substantive matters.

“It should be something more than just a photo shoot,” Godsell said. Naidoo said “nice conversations belonged in the pre-1994 period”. - I-Net Bridge.

http://www.busrep.co.za/index.php?fArticleId=5454131

Was just reading an article on iAfrica today :


Solar plant for SA
Article By: Fri, 30 Apr 2010 10:46
Solar boiler maker Areva Solar is ready to build a 100 megawatt concentrated solar plant in South Africa from next year, the Business Day newspaper reported on Friday.

It cited Tom Bartolomei, the French firm’s senior vice-president for business development as its source.

"Areva Solar is among several companies who are eager to establish a renewable energy industry in South Africa once the government has announced its long-term energy plans," the newspaper wrote.

Areva also wanted to get into South Africa's nuclear industry and it had been in the running for the contract to build Eskom’s second nuclear plant.

The project, however, was shelved in 2008, Business Day reported.

It quoted Bartolomei as saying that South Africa presented a strong concentrated solar market opportunity.

"South Africa is fortunate to have a strong solar resource."

Bartolomei said Areva Solar was prepared for the construction of a 100 megawatt plant between 2011 and 2012.

"The technology is ready," he was quoted as saying.

However, investments in renewable energy depended on the outcome of the integrated resource plan process.

The energy department has committed itself to releasing the plan by June.

It would be FANTASTIC if this were to come to fruition.

Eskom still requires R200bn in funds, no plan beyond 2017
May 5, 2010

By Donwald Pressly

Despite receiving a massive World Bank loan and steep tariff hikes for the next three years, Eskom needed additional finance of nearly R200 billion for its build programme over the next seven years, MPs were told yesterday.

Eskom is in a race against time as building costs rocket because of delayed decisions, which creates a vicious circle of rising costs for the power utility. It also admitted yesterday to having calculated its build programme sums incorrectly, by a long margin.

Eskom acknowledged that it would turn again to the World Bank for funding of clean technology power projects. It would also participate in public-private partnerships and go to equity and debt markets to fund massive build cost inflation.

Mpumalanga's coal-fired Kusile station costs have rocketed from R80bn to R142bn, because of delays and higher interest charges.

"We really have a problem with funding," Eskom chief financial officer Paul O'Flaherty told MPs.

After discussion in Parliament's public enterprises committee, it emerged that Eskom appeared to have no game plan beyond 2017.

A $3.75bn (R27.7bn at yesterday's exchange rate) loan granted by the World Bank last month will fund the Medupi coal-fired plant in Limpopo. Some of the funds will flow to wind and solar power plants, but none would go to Kusile.

Pressed on why more money was not sought from the bank, Eskom said that the application had been made before its request for a 35 percent tariff hike had been rejected by the National Energy Regulator of SA. The regulator gave it about 25 percent a year instead.

MPs were also warned that there could be power shortages, particularly after 2017, if alternative fuels for power generation other than coal use were not found.

If a decision to use nuclear was taken, it had to be taken now, as it took 20 years for such a plant to come on stream.

O'Flaherty, who joined the parastatal in January, said he did not believe that the World Bank would fund more coal-fired projects.

He noted that Eskom produced about 41 000 megawatts of power at present.

An additional 17 000MW would be needed by 2017, a further 8 000MW by 2020, and 17 000MW more by 2025 to keep up with anticipated demand.

While the coming on stream of the Kusile and Medupi power plants "gets us there by a tight measure by 2017", O'Flaherty reported, other answers to the energy requirements were needed thereafter.

Eskom acting chief executive Mpho Makwana said the shareholder, which is the government, needed to conduct its own investigation into the changing power needs of the country. Eskom needed to work within these parameters.

O'Flaherty said about a quarter of the "current fleet" of coal-fired power stations needed to be replaced between 2021 and 2028.

Some were nearing 50 years old, about 10 years older than intended. Makwana reported that the utility had 27 power plants, 85 percent of which were coal-fired, while the rest were either nuclear, open-gas turbines or hydropower plants.

http://www.busrep.co.za/index.php?fArticleId=5456620

^^
Eskom faces R190bn shortfall
May 4, 2010 3:47 PM | By Sapa

Eskom faced a total shortfall of R190 billion between now and 2017, despite a large World Bank loan, says financial director Paul O'Flaherty

Eskom faced a R111bn shortfall over the next three years to implement its build programme, he told Parliament's portfolio committee on public enterprises.

The company needed the money to complete its new power station at Kusile, which was vital to meet electricity demand forecast to recover apace with the economy, said O'Flaherty.

"In the next three years we really have a problem with funding," he said.

"The unsecured funding as we sit today is R173bn and year by year also results in a cumulative shortfall of R17bn, so the actual shortfall is R190bn over seven years."

Acting Eskom chief executive officer and chairman Mpho Makwana and O'Flaherty said Eskom was mulling "50 options" to make up the shortfall in coming years, but conceded that beyond 2017 there was no gameplan.

Eskom's reserve margin of supply is expected to dip below 15 percent between 2018 and 2023 following the decommissioning of old power stations like Hendrina and Arnot.

Documentation provided to MPs showed that it would need to produce an additional 8, 184 megawatts between 2017 and 2020 with no clear idea yet as to how.

O'Flaherty said that if Eskom had to ensure it continued as a going concern and remained solvent with such a large shortfall, it needed to find another method by which to fund new technology.

Eskom's representatives were rebuked by committee chairwoman Vytjie Mentor for still not having finalised a funding model.

MPs wondered why the utility had not asked the World Bank for a bigger loan than the US3.75bn approved in April.

O'Flaherty said the company started negotiations with the bank more than 18 months ago, before it knew that the national energy regulator Nersa would reject its application for tariff increases of 35 percent a year.

Instead, Nersa approving hikes averaging 25 percent a year for the next three years.

O'Flaherty assured MPs that Eskom was "far down the track on finding solutions" to cash woes for the next three years.

These included saving money on personnel, which could come to some R4 billion or more, by controlling overtime and improving productivity, which he conceded was not optimum.

O'Flaherty told reporters that Eskom would like the government, which has already underwritten R176bn in debt for the company, to give it further guarantees.

"That would be a definite benefit for Eskom because it would enable you to raise more guaranteed money."

He said Eskom did not want to "saturate the local bond market" and rejected suggestions that the utility approach the Industrial Development Corporation as it was not in a position to give anybody a loan of more than R2bn.

Makwana said Eskom had enlisted international financial services group Credit Suisse to finalise an equity model for Kusile, and JP Morgan to help conclude a broader funding model for Eskom.

Both companies were contracted in April and given 60-day deadlines, which meant their proposals would be submitted in June.

Makwana dismissed criticism from MPs and a handful of environmentalists who gatecrashed the meeting about Eskom's continued reliance on coal, but added that the company's mid-term aim was to cut the percentage of total power output derived from coal from 85 to 70 percent.

"Coal is our immediate reality," Makwana said.

"In the end, it is matter of rands and cents and dollars," he said, and argued that coal in the southern hemisphere contained less sulphur and therefore contributed less to global warming.

O'Flaherty acknowledged that Eskom would be unlikely to secure further funding from the World Bank for coal-fired plants.

He told reporters Eskom would get its first instalment of the World Bank loan in July, to pay for construction already completed.

He insisted that the public could rest assured that none of the World Bank funding would be used to cover work by Hitachi Power Africa, in which the ANC's investment arm Chancellor House holds a 25-percent stake.

Under the terms and conditions of the loan, Eskom will present the World Bank with invoices for completed work and only then will the bank release the money to pay, he said.

http://www.timeslive.co.za/business/article432884.ece/Eskom-faces-R190bn-shortfall


i worked with o`flats at G-5 once upon a time, he knows his stuff and he knows a stuff up when he sees one and he shoots from the hip with a big gun.
These are large figures, so, should we really have gone for a world cup with all the associated bells and whistles and airports and and and when we struggle to turn the lights on.......:ohno:

eeerrr allow private power generation with proper feed in rates???

They will never, many pvt firms had proposals on many types of alternatives but govt wouldnt listen as they still believe eishkom is the future.

PIC to invest billions in Eskom
May 14 2010 15:20


Johannesburg - South Africa's biggest investment fund, the Public Investment Corporation (PIC), plans to invest as much as R9bn in the expansion of power utility Eskom.
The SABC reported on Friday that the investment was needed to keep pace with economic growth.

The investment by the state's pension fund manager of about one percent of its more than R900bn in assets in Eskom formed part of the R45bn planned expenditure to spur the country's economy, the SABC reported.

PIC chief investment officer Dan Matjila was quoted by the broadcaster as saying that the fund intended to allocate five percent of its holding development projects - up from about one percent currently - to boost direct investment in other state companies.

This included ports and rail operator Transnet and the SA National Roads Agency.

According to Matjila, the PIC's strategy in the next few months would be to move more into unlisted instruments in areas such as energy, water, transport, schools and affordable housing.

Providing assistance to Eskom must happen this year, Matjila added.

- Sapa

page1

wonder when this comes back to bite the hand that feeds it..

http://www.fin24.com/Companies/PIC-to-invest-billions-in-Eskom-20100514

Target of 20% wind power is called for
May 14, 2010

By INGI SALGADO

The SA Wind Energy Association (Sawea) yesterday called on the government to set a 2025 target of generating 25 percent of electricity from renewables, 80 percent of which should be reserved for wind.

The target would translate into 30 000 megawatts of installed wind capacity. South Africa's total installed capacity is around 40 900MW at present.

The proposal follows an in-depth study "to give decision makers the facts about wind energy", Sawea deputy chairman Mark Tanton said. It forms part of the industry body's submission to the government regarding the second integrated resource plan (IRP2), which will provide the country's energy blueprint over the next two decades.

Sawea said the extra cost to consumers of achieving its proposed renewable energy target would amount to 0.7c per kilowatt of electricity consumed, equivalent to less than 1 percent of the wholesale electricity price.

"A year ago to throw out a statement that wind would be a cheaper option would have been difficult. But not anymore," Tanton said.

The energy regulator's renewable energy feed-in tariff (Refit) for wind has been set at R1.25 a kilowatt-hour for a period of 20 years. By comparison, the cost of generating electricity at the proposed Kusile coal-fired power station is estimated at R1.20 a kilowatt-hour, without factoring in coal price hikes. Eskom is believed to pay at least R2.80 a kilowatt-hour when running its diesel-fuelled gas turbines.


"I can predict what the cost of wind energy will be tomorrow and even 10 years from tomorrow but the only prediction we can make about coal or oil is that it will be more expensive," Tanton said.

The Sawea study said South Africa's electricity network could immediately accommodate 6 600MW of wind energy without significant upgrading. About 7 000MW of wind energy capacity is in development.

Tanton dismissed concerns from Eskom and the government that wind could not be used as a source of baseload power because of its unpredictability. "It's absolute rubbish," he said. "Eskom's way of thinking is so outdated."

South Africa's excellent geographical spread for wind, combined with sophisticated weather forecasting technology, meant that 30 000MW of installed wind capacity would provide an average daily minimum power output of 7 000MW.

Adam Bruce, the chairman of Renewable UK, Britain's 600-member industry body for renewable energy developers, agreed. "Wind energy specifically and renewables generally can provide the firm power required as baseload," he said.

An ambitious target would also encourage local production of wind turbines, he told a wind conference in Cape Town.

Sawea said its proposed wind target would create 40 000 new jobs, a third of which would be in rural areas.

http://www.busrep.co.za/index.php?fArticleId=5469058&fSectionId=561&fSetId=662

Eskom strike threatens Cup

Over a hundred Eskom shopstewards from the National Union of Mineworkers (NUM) have taken a unanimous decision that members employed at the parastatal should go on strike action on May 26, a move that could impact the World Cup which begins in June.

--------------------------------------------------------------------------------
Transnet battles to clear strike backlogs
The strike - which was suspended last year pending negotiations- would begin on May 26 and a massive march would take place to Megawatt Park, Eskom's headquarters.

"Workers demand that Eskom should address all their outstanding issues from last year's negotiation cycle," the NUM said in a statement.

This included a housing allowance.

"Amid several marches and memoranda delivered to Eskom, the parastatal is yet to respond to the demands."

Eskom was not able to comment immediately


http://www.timeslive.co.za/business/article458330.ece/Eskom-strike-threatens-Cup


11% minimum got to keep up with the transnet offer+++++++:ohno:

Eskom may use wood-based biomass fuels
May 24, 2010

Electricity parastatal Eskom may use wood-based biomass fuels for firing or co-firing its coal fired power stations.

In an advertisement in Business Day newspaper on Monday, the utility called for an expression of interest to enable it to set up a list of consultants able to conduct a study on the availability and sustainability of wood-based biomass for use in power stations.

Eskom said the study would cover which wood-based biomass fuels were available in South Africa and who the potential suppliers would be.

The study would also concentrate on what the total available tonnage and reliability of wood-based biomass fuel would be.

The nature of the existing infrastructure for transport of wood-based biomass fuel from forestry to processing industries and finally to power stations would also be considered. - Sapa


http://www.busrep.co.za/index.php?fSectionId=561&fArticleId=5483041

Newly launched atlas identifies viable sites for SA carbon storage

By: Christy van der Merwe
10th September 2010

Energy Minister Dipuo Peters on Friday launched the South African Carbon Capture and Storage (CCS) Atlas for the geological storage of carbon dioxide (CO2) deep underground.

The Atlas highlighted, at a theoretical level, that South Africa had about 150 Gigatons (Gt) of storage capacity, and where this capacity was located.

This was significant because without the storage potential, South Africa's CCS plans would not have been able to go ahead. "This important milestone is saying go, instead of no-go," reiterated Central Energy Fund CEO Mputumi Damane.

The majority of the storage capacity was located offshore, which was not the best outcome for South Africa, as there were high logistical costs associated with offshore storage, considering that the country's CO2 emission sources were predominantly inland, in the Mpumalanga province.

The largest storage volume, representing about 98% of the total storage potential, was present in the Mezoic basins along the coast of South Africa. This storage capacity was mainly in the capacity of saline formations in the Outeniqua, Orange, and Durban or Zululand basins.

It was estimated that the Outeniqua basin had storage capacity of some 48 Gt, the Orange basin could store about 56 Gt, and the Durban/Zululand basin had 42 Gt of storage potential.

Less than 2% of the estimated storage capacity in South Africa occurred onshore. About 0,46 Gt for the onshore Zululand basin, some 0,40 Gt at the onshore Algoa basin, and about 1,2Gt in what were today considered unmineable coal seams in South Africa.

The South African Centre for CCS would now concentrate on qualifying the work of the Atlas by doing further drilling and seismic studies in the onshore areas identified.

The next major milestone was to have a test injection site up and running by 2016. A test injection site would need to be identified, and operational to determine the suitability of the local geology as a storage medium, as well as the dispersion and transformation of CO2 in South African rocks.

South African Centre for CCS head Dr Tony Surridge told Engineering News Online that the centre had received financial support from the UK's Department of Energy and Climate Change to further investigate and qualify the Durban/Zululand basin's onshore storage capacity.

This would take the storage capacity from a theoretical level, to a more realistic level. It was possible that the storage capacity of the various basins was revised downwards as more information was made available.

The South African Centre for CCS had also submitted a proposal for financial assistance from EuropeAid, to fund further investigation into the onshore Outeniqua basin.

CCS Atlas project manager Marthinus Cloete, from South Africa's Council for Geoscience, explained that the atlas clarified where the potential for storage existed, and that the estimates would be refined with basin and site specific information through seismic testing and drilling.

South African Centre for CCS board of governors chair Barry MacColl emphasised that CCS was critical to finding a cleaner future for South Africa, which emitted some 440-million tons a year of CO2.

He also highlighted that while the centre progressed with refining work in the Atlas, it would also need to tackle the challenges of raising awareness on CCS, developing skills in this area, as well as working on the policy and legal frameworks for CCS.

"This technology is still evolving, from a commercial deployment perspective, and remains a global matter requiring a collective approach and international co-operation at both the policy and technical levels," said Peters.

She added that CCS was one of a range of options that South Africa was focusing on in order to mitigate greenhouse gas emissions and meet global climate change commitments.

Increasing the use of renewable energy and implementing energy efficiency measures, were some of the other options to satisfy the country's determination to move away from a dependency on coal.

However, Peters added that it would be irresponsible to not use the country's coal resources to eradicate energy poverty in South Africa. Investment in CCS would allow South Africa to use its abundant coal reserves while protecting the environment for future generation.

Edited by: Mariaan Webb

http://www.engineeringnews.co.za/article/newly-launched-atlas-identifies-viable-sites-for-sa-carbon-storage-2010-09-10

Medupi power station not delayed
15 Sep 2010 - I-Net Bridge -

Intro
South African power utility Eskom has moved to allay fears that its Medupi power station was likely to be delayed by two years.

South African power utility Eskom on Tuesday moved to allay fears that its Medupi power station was likely to be delayed by two years.

"The Medupi power station has not been delayed by two years, and reports suggesting this are not true," the utility said in a statement.

A media report earlier on Tuesday quoted diversified resources group Exxaro as saying the 4,800 megawatts Medupi coal-fired power plant was behind by two years.

Medupi's first of six 800 MW units were due to come on stream by April 2012.

Eskom has previously mentioned that there is a potential three-month delay on Medupi for the commissioning of the first unit to September 2012, with additional units coming on stream individually every six to eight months thereafter.

There were also media reports last month that also suggested that Eskom's other major power station Kusile was being scrapped. These reports were also squashed by Eskom.

"Various 'scenarios', including stopping the building of Kusile or delaying Medupi for two years, have been run for the Department of Energy's Integrated Resources Plan 2 (IRP 2) modelling but they are no more than scenarios," said Eskom finance director Paul O'Flaherty.

"In particular, Eskom has submitted a proposed funding model for Kusile to the government. A decision on it is imminent following which Eskom will be in a better position to comment on how Kusile will be funded," said O'Flaherty.

"The government and Eskom are 100% committed to building Kusile," he added.

Costs for Medupi are 125 billion rand and for the second power station Kusile 140 billion rand.

These costs include estimated interest to be capitalized on monies borrowed to fund these projects.

Source: eProp (http://www.eprop.co.za/news/article.aspx?idArticle=12886)

South African Solar Plant to Create Up to 12,300 Jobs, Government Says
By Ron Derby - Sep 28, 2010

South Africa’s planned 5,000 megawatt solar energy park, which will be the world’s largest if built, could create as many as 12,300 jobs, Minister of Energy Dipuo Peters said.

The project, which may be built at Upington in the nation’s Northern Cape province, is ideal for the establishment of a solar park because of intense solar radiation for much of the year, she told reporters in Johannesburg today.

A pre-feasibility study has been completed and South Africa could start talks with investors as soon as early 2011, Ompi Aphane, deputy Director General at the Department of Energy, said at the same briefing.

South Africa is battling a power shortage after the government halted expansion plans by state-owned electricity producer Eskom Holdings Ltd. for four years until 2004 while it tried and failed to convince companies to build power plants.

Initial estimates indicate that the planned solar plant could cost about 150 billion rand ($21.1 billion), government spokesman Themba Maseko said in Cape Town on Sept. 16.

Eskom is planning a 100 megawatt solar thermal energy project, also in Upington. The plant, which received funding from the World Bank, is expected to be completed by 2014.

The largest solar power plant currently in operation is a 64 megawatt solar thermal energy project at Nevada in the U.S.

[b]S.Africa's PetroSA approves $1 bln offshore gas project(/b]

CAPE TOWN, Sept 28 (Reuters) - South Africa's national oil company PetroSA said on Tuesday it has approved a $1 billion offshore gas project that it expects will start producing by the first quarter of 2011.

The offshore gas field, called "FO" was located off the south coast and has in the region of 1 trillion cubic feet (TFC), with an upside of 2-3 TFC, the company said.

"Our next project is focusing on the FO project, which is the gas field approximately 40 kilometres (25 miles) away from the existing platform," Sandro Borean, PetroSA's regional manager for new ventures upstream told an African energy conference.

"It's a very large project, it's a billion dollar project or thereabouts and we anticipate first gas in the first quarter of 2013. This has been approved by the board recently," he said.

South Africa has limited gas reserves, mainly located in the south coast's block 9 region, where the FO field is, and is scrambling to secure supplies to one of the world's largest gas-to-liquids refineries in Mossel Bay.

PetroSA operates one of the world's largest gas-to-liquids refineries at Mossel Bay in South Africa and holds exploration acreage in Gabon, Equatorial Guinea, Egypt, Namibia and Mozambique.

PetroSA approves $1bn offshore gas project
Sep 28 2010 17:04

Reuters

Cape Town - South Africa's national oil company PetroSA said on Tuesday it has approved a $1bn offshore gas project that it expects will start producing by the first quarter of 2011.

The offshore gas field, called "FO" was located off the south coast and has in the region of 1 trillion cubic feet (TFC), with an upside of 2-3 TFC, the company said.

"Our next project is focusing on the FO project, which is the gas field approximately 40km away from the existing platform," Sandro Borean, PetroSA's regional manager for new ventures upstream told an African energy conference.

"It's a very large project, it's a billion dollar project or thereabouts and we anticipate first gas in the first quarter of 2013. This has been approved by the board recently," he said.

South Africa has limited gas reserves, mainly located in the south coast's block 9 region, where the FO field is, and is scrambling to secure supplies to one of the world's largest gas-to-liquids refineries in Mossel Bay.

PetroSA operates one of the world's largest gas-to-liquids refineries at Mossel Bay in South Africa and holds exploration acreage in Gabon, Equatorial Guinea, Egypt, Namibia and Mozambique.

SA looks to nuclear future
JOHANNESBURG, SOUTH AFRICA
Sep 29 2010 07:24

As much as 50% of South Africa's' new electricity production could be comprised of nuclear energy, national planning commission member Bobby Godsell said on Tuesday.

"Nuclear power is going to be part of the plan," Godsell said at a public discussion in Johannesburg on energy in South Africa.

Between 10 000 and 20 000 megawatts of the 40 000 megawatts the country would need in the future could come from nuclear energy, he said.

Energy Minister Dipuo Peters said that while nuclear energy would be part of the country's future, there was concern about maintaining a supply of enriched uranium. She said that China was consuming more and more of African imports of the material.

"By the time we build this nuclear power plant we will not be able to afford enriched uranium," said Peters.

Godsell said another impediment would be opposition from property owners who would be averse to having nuclear power plants built near their homes.

"People with homes on the coast may not like it because nuclear power plants will be built on the coast," he said.

A report on the future of electricity production -- the integrated resource plan (IRP) -- was currently being compiled and prepared for publication in December.

Peters said the IRP and future of energy production would depend on a mix of sources including nuclear, coal and solar.

Clinton Foundation representative Ira Magaziner, who is advising the government on solar power, said South Africa held a great deal of potential for solar power.

"The conditions we found in the Northern Cape are the best we found anywhere in the world," said Magaziner.

The year-round sunshine, low rainfall, the surplus of usable land which was also government owned, the lack of a rainy season and the presence of the Orange River were all factors which made solar electricity viable.

"South Africa is a growing country and should become a developed country in the next decade. But it needs energy," said Magaziner.

He said that solar energy could become cheaper than coal in the "next few years".

SA to seek investment in solar park
Peters said the country would host an investors' conference on October 28 and 29 in an effort to generate private-sector interest in a 5 000-megawatt solar park.

The energy department estimates the project would cost billions of dollars over a decade-long period.

Peters said the government would provide all the infrastructure for the project, then lease out land to private developers who would finance and build individual projects that would sell power to the national grid.

South Africa relies on coal for about 90% of its annual energy production.

The proposed solar park would provide as much power as one coal-fired power station, Peters said. - Sapa

http://www.mg.co.za/article/2010-09-29-sa-looks-to-nuclear-future

^^ This is just taking so much time too materialize. Lets build some nuke plants:evil:
Solar park? Let me get down south, theirs work for me:)

^^ come down buddy, come.

^^ come down buddy, come.

Another year or so and Ill be back home!:)

Nice.

SA to get six new power plants
Oct 07 2010 22:14

Johannesburg - South Africa will get six new power stations worth R1.3 trillion in an effort to eradicate power cuts, the SABC reported on Thursday.

China, France and South Korea would help in the construction of the proposed new stations, the energy department's director general Nelisiwe Magubane said.

The power stations, which formed part of the government's new proposed energy plan, would use "different technology".

"This project has actually not yielded the required results... we need them to re-look the research projects.

"But in the meantime we are still going to need additional power plants and we are going to use what we call conventional nuclear power as we use it in Koeberg, in Cape Town," she told the broadcaster.

------------------------------
where the heck will a TRILLION come from? Govt spewing shite again!

S.Africa to halve reliance on coal, push for nuclear
Fri Oct 8, 2010 9:32am GMT

JOHANNESBURG (Reuters) - South Africa expects six new nuclear plants and renewable energy to play a major role in plugging its power deficit as it seeks to halve reliance on dirtier coal-fired plants, a draft of a government energy plan showed.

Africa's biggest economy currently relies on coal for almost all of its electricity supply, but in a draft of its Integrated Resource Plan (IRP 2), a 20-year electricity capacity programme, the government proposed that coal's contribution should drop to 48 percent.

Instead, the government sees nuclear supplying 14 percent of the country's energy mix by 2030 and renewable energy 16 percent, while the remaining capacity would come from open cycle gas turbines, pump storage schemes and imported power generated from hydroelectric plants.

Nuclear currently supplies 1,800 megawatts (MW), or 6 percent of the country's power, from Africa's only nuclear plant near Cape Town.

According to the IRP draft, released to journalists late on Thursday, the government forecasts six 1,600 MW nuclear plants coming on stream between 2023 and 2029.

The plan estimates that some 52,248 MW would need to be built on top of South Africa's current supply of around 40,000 MW to meet fast-rising demand and avoid the repeat of a power crisis which shut down mines and other industry for days in 2008 and cost the country billions of dollars in lost output.

The estimates are based on annual gross domestic product growth of 4.6 percent.

State-owned power utility Eskom currently supplies some 95 percent of the country's power, but the government is keen to get private investors on board to help foot the bill for new power plants and reduce the strain on Eskom's balance sheet.

The government said South Africa's power supply remains "very tight", with a deterioration expected from 2011 until 2016.
"From 2011 to 2016, rolling blackouts are anticipated unless extraordinary steps are taken to accelerate the realisation of the non-Eskom generation and energy efficiency projects," it said.

The performance of Eskom's current power plants, most of which were built more than 20 years ago, is also expected to decline, given a lack of time to conduct appropriate maintenance and due to worsening of the quality of coal supplied to Eskom.

Eskom is currently building two new 4,800 MW coal-fired power plants and the government said any delay in the two plants would prolong and exacerbate the supply shortfall.

© Thomson Reuters 2010 All rights reserved


http://af.reuters.com/article/investingNews/idAFJOE69709J20101008?sp=true

Blackout alert
LYNLEY DONNELLY
CAPE TOWN, SOUTH AFRICA
Oct 08 2010 08:14

South Africa will face rolling blackouts from 2011 until 2016 -- like those seen in 2008 -- if drastic action is not taken to introduce independent power producers and rapidly increase energy efficiency.

This emerged with the release of an executive summary of the draft integrated resources plan (IRP2010) by the department of energy on Thursday. The full draft IRP2010, which maps South Africa's electricity future, will be released on Friday for public comment, with the aim of promulgating the document by the end of the year.

With the IRP2010 the department has published a medium-term risk mitigation plan (MTRMP) aimed at addressing the shortfall in electricity expected between 2011 and 2016.

The IRP2 is a long-term plan and will not address the coming shortfalls in electricity in the near future.

"From 2011 to 2016 rolling blackouts are anticipated unless extraordinary steps are taken to accelerate the realisation of the non-Eskom generation and energy-efficiency projects," it said.

It said that Eskom's current fleet would be hard-pressed to sustain required performance levels, as there was not enough time to perform adequate maintenance and improve the quality of coal being supplied to a number of its power stations.

The development of the draft IRP2010 considered a number of scenarios to map out the future of the energy landscape and a number of the scenarios factored in delays in commissioning Medupi, as well as a possible cancellation of Kusile.

The IRP2010 was aimed at balancing the "cost of electricity production" with the "limiting of carbon emissions", said a statement from the inter-ministerial committee on energy.

Of the 17 scenarios considered, two -- the balanced scenario and the revised balanced scenario -- which came out of discussions in the department and workshops with the inter-departmental task team, presented the best case to meet the key priorities.

"The balanced scenarios represent the best trade-off between least-cost investment, climate-change mitigation, diversity of supply, localisation of, and regional development," it said in the draft IRP.

The balanced scenario included committed energy projects under the previous IRP and some additional renewable energy.

Under the balanced scenario the future electricity energy mix by 2030 would comprise coal at 48% of baseload power. Nuclear energy would make up 14% of baseload power -- up from 6,5% at present. A further 2% of baseload power would come from imported hydropower.

About 5% of mid-merit power would be supplied by gas, while peaking power would come from open-cycle gas turbines (OCGTs) supplying 9% and pump storage 5%.

The inclusion of OCGTs has been controversial given the high cost of running this plant which runs on diesel fuel to supply power when demand is at its highest.

Renewable technologies
About 16% has been set aside for power from dispatchable renewable technologies.

A large emphasis on energy efficiency is also factored into the plan.

The draft document notes that the balanced scenario provides for a 30% reduction in carbon emissions, while only requiring an extra 8% in funding compared with the least-cost scenario. Weighed against a low carbon scenario, which will require an additional R790-billion, the balanced scenario could be significantly cheaper.

However, the finalisation of the IRP2010 will come against the backdrop of intense work in the medium term to save power and keep the lights on.

The likely delays in the commissioning of Medupi and Kusile power stations because of uncertainty around funding will exacerbate the threatened shortages.

The mitigation plan noted that, while opportunities to reduce the shortfall in power supply exist, they are constrained by the lack of financial incentives, regulatory instruments, bureaucratic red tape and enabling policy.

A project team has been established to assess options to alleviate the immediate shortage in supply.

Some of the realisable risk mitigation solutions identified include the speedy introduction of available renewable projects at 320 gigawatt hours (GWh), co-generation and own-generation projects by large power users, of 7 330GWh and 22 500GWh respectively, as well as the introduction of independent power producers, who could bring 14 000GWh online.

It also highlighted the need for energy efficiency projects and energy-efficiency technologies to create savings of 7000GWh and 12 000GWh respectively.

This would require "extraordinary action in the main by the government, Eskom, business and large metropolitan councils".


http://www.mg.co.za/article/2010-10-08-blackout-alert

^^ This is just taking so much time too materialize. Lets build some nuke plants:evil:
Solar park? Let me get down south, theirs work for me:)

South Africa's Solution To Global Warming - Go Nuclear!

South Africa to reduce green house emission by replacement of cheap coal with Nuclear.

http://www.fin24.com/Business/Six-nu...anned-20100908

South Africa, the country most similar to Australia in having vast cheap coal reserves and uranium, has opted for the more expensive nuclear generation in order to meet its emission targets.

By building 6 near identical plants it dramatically reduces the cost per plant, and gets zero emission power at a fraction of the cost of "renewables" such as solar and wind.
http://forum.onlineopinion.com.au/th...iscussion=4019
http://mybroadband.co.za/vb/showthread.php/274344-South-Africa-s-Solution-To-Global-Warming-Go-Nuclear!

Another year or so and Ill be back home!:)

me too , plan on being back for christmass next year

me too , plan on being back for christmass next year

Yip, Ill be back by October.

long time for me nearly 14 years

long time for me nearly 14 years

20 for me:) Have lived 2/3 of my life outside SA. Enough! Time too head back, I miss my country too much already:)

Sasol product to slash power bills
Oct 13 2010

Johannesburg - An alternative source of energy from Sasol [JSE:SOL] will provide thousands of homeowners with a significantly smaller monthly energy account, as well as a smaller carbon footprint.

On Tuesday the petrochemical giant introduced its new Sasol Homegas product at the Waterfall Country Estate in Midrand, currently the largest property development in the country and the first to use the gas.

The product is liquefied petroleum gas (LPG) which is stored in large 6 200-litre to 22 500-litre gas tanks on the premises of the development for use as an alternative energy source.

It is the first such project and Sasol plans to roll it out on a large scale countrywide in new developments.

It's a step in the direction of a “greener” future, said Pieter Claassen, Sasol Oil’s manager for new business development.

It is especially targeted at developers of new housing and at the low-income housing market.

He said the gas would be used to heat water, for indoor heating and for cooking.

At the same time the houses will be supplied with solar panels.

This would reduce the average household's dependence on electricity by some 60%. The saving on the total electricity account would be 18% to 20% and households’ carbon footprint would come down 40% to 50%.

It would considerably reduce the pressure on South Africa’s electricity network and ensure that buildings had a reliable alternative source of energy at all times, lightening the household burden of rising electricity tariffs.

This gas is already being used in millions of homes globally, but its use in South Africa has always been limited because the country until recently had very cheap electricity.

The infrastructure to install the product will add to developer’s costs.

Claassen said a R1.5m house would cost an average of 1% more to build and low-income houses about 2% more.

Mark Corbett, chief executive of Century Property Developments, which is developing Waterfall, said the gas will be stored on the premises and distributed to each house.

Each house will have its own gas meter and households will be able to pay for the gas in advance.

Waterfall is currently the biggest residential development in the country and 3 000 houses will be built there over the next five years.

Corbett said the stands sell for between R600 000 and R6.5m for units from 600m² to one hectare. The first three stages, a total of 700 erven, have already been sold.

Sasol Homegas will be installed by qualified staff in compliance with all international and domestic safety standards.

The gas has a distinct smell, so that any leaks can be picked up and traced immediately.

PetroSA eyes oil-rich Angola
Oct 12 2010

Johannesburg - South Africa and Angola are close to signing an oil deal that could see South African national oil company PetroSA enter exploration and refining operations in Angola, state media said on Tuesday.

PetroSA is in negotiations with Angola's parastatal oil firm Sonangol to enter into crude production, deep-water exploration and refinery operations in oil-rich Angola, South African Energy Minister Elizabeth Dipuo Peters said on Monday, according to state daily Jornal de Angola.

Speaking at the end of a visit to Luanda to meet with Angolan Oil Minister Jose Botelho de Vasconcelos, Peters said an agreement between PetroSA and Sonangol could be signed later this month, when Angolan President Jose Eduardo dos Santos visits South Africa, the newspaper reported.

"The petroleum industries of South Africa and Angola have all the right conditions to complement each other," De Vasconcelos said.

Under the deal, PetroSA could get a stake in Angola's new Lobito refinery, De Vasconcelos said.

Construction on the 200,000-barrel-a-day refinery is due to begin later this year after repeated delays.

When finished in 2014, it is expected to end Angola's dependence on imports of refined petroleum products.

Angola, which vies with Nigeria for the title of Africa's largest oil producer, pumps 1.9 million barrels of oil a day but currently imports 50% of its refined fuel.

Peters said South Africa, which is also at work on a 350,000-barrel-a-day refinery, wants to increase imports of Angolan crude.

South Africa produces just 35,000 barrels of oil a day, but has the continent's second-highest refining capacity after Egypt.

Peters said southern Africa has the potential to become energy independent if the countries of the region cooperate.

The deal would expand on one signed last year during a visit by president Jacob Zuma to Luanda, under which the two countries pledged to work together in the areas of exploration, refining and distribution.

Refinery project to save SA billions: Zuma
Oct 14, 2010 2:58 PM
By Sapa

A planned crude oil refinery to be built in the Eastern Cape will save South Africa about R12.6-billion a year in energy costs, says President Jacob Zuma.

"This country stands to save... once the refinery is running, and could export oil across Africa," Zuma said in a speech prepared for his visit to PetroSA's gas liquid refinery in Mossel Bay on Thursday.

He said the project, expected to be built by 2015, would showcase South Africa's competitive ability to its counterparts globally, which was important for the image as a country.

It would also help the country escape from the current dependency trap where refined automotive products had to be imported, he said.

Once completed, the refinery in the Coega Industrial Development Zone near Port Elizabeth would be the biggest in Africa.

"We welcome the fact that PetroSA is making its impact, not only in job creation but in empowering the people as well. It employs close to 2000 people, while 27,500 more will be absorbed within the crude oil refinery that is planned," he said.

Zuma also welcomed the impressive growth of PetroSA from its successful merger of Mossgas, Soekor and parts of the Strategic Fuel Fund in 2002.

"To be able to reach the markets in Europe, the USA, Caribbean, Middle East and the Far East, is an important achievement.

"With the company supplying about seven percent of South Africa's liquid fuel needs, indications are that we will lessen our dependence on foreign sources of fuel," Zuma said.


http://www.timeslive.co.za/local/article707362.ece/Refinery-project-to-save-SA-billions--Zuma

SA needs 'to maximise the role of renewable energy'
TARRYN HARBOUR
JOHANNESBURG, SOUTH AFRICA
Oct 11 2010 15:58

Renewable energy technology in South Africa is ready and waiting; it just has to be rolled out.

This was the conclusion reached by the panellists at the second of the Shell Energy Dialogues last Thursday.

The discussion was chaired by CNBC Africa presenter Lerato Mbele and included Wendy Poulton from Eskom; Richard Worthington from the World Wide Fund; Professor Johann Görgens from the University of Stellenbosch; Stuart Fredman from Clean Energy Solutions; and Barry Bredenkamp from the Central Energy Fund. The theme of the evening was "Alternative Energy: Pipeline or Pipedream?"

South Africa has pledged itself to the target of 4% renewable energy by 2013, but the question is whether the country will be able to achieve this goal, given the monopolisation of coal-based power producer Eskom in the local energy market.

"The only way we're going to achieve a just transition to a sustainable electricity supply is to maximise the role of renewable energy," said Worthington. "The future will be predominantly and eventually entirely in renewable energy."

But, warned Bredenkamp, the responsibility for the transformation to renewable energy is not solely the government's responsibility: "You and me as individuals also have a role to play. There's a lot of alternative energy that we can use in our own homes."

South Africa has massive renewable energy potential, with its many hours of sunshine and wind. Developers are keen to get started, but the problem is getting it to the people.

"Who is the developer going to sell [energy] to? You have to be able to transmit it across the national grid," said Fredman. "Give us access to the national grid and we'll achieve the energy targets and bring the levelised cost of energy down over the next 10 years."

Cost issues
Part of the problem of getting people and industry to use alternative energy is the cost.

Fredman explained: "The cost is slightly higher over the short term than [coal-fired power stations] … but as we look over 10, 15, 20 years, the cost comes down to be level with coal, and then significantly lower."

A factor in renewable energy's favour has been the recent global economic crisis and the rising costs of oil and other energy.

Görgens said: "The renewable energy debate in the last five years has really picked up momentum because of global economic changes. Economics will always play a very strong role."

People must look at the long-term benefits instead of the initial cost, added Worthington. "A compact fluorescent lamp will save you a lot of money over its life cycle.

"Don't look at the cent-for-cent comparison per kilowatt hour for alternative energy as opposed to coal; rather look at the cost of not having energy. What is it going to cost the economy if we don't do something quickly and run out of coal-fired power?"

Fredman proposed a solution: "We pay two cents an hour for some form of carbon tax and it's been sitting in the Treasury … At the moment it has a quantum value of about R8-billion. So the money is there to start a reasonably large roll-out of renewables."

It is important for South Africa to start implementing renewable energy technology as soon as possible, said Bredenkamp. "South Africa is one component of a large globe … Most countries are accelerating their update of alternative energy. These technologies have to be manufactured and the longer we wait, the further behind we get in the queue."

"We have a very energy-intensive economy," said Poulton. "We not only have to change our carbon systems, we also need to look at the energy beyond our economy and become more energy efficient."


http://www.mg.co.za/article/2010-10-11-sa-needs-to-maximise-the-role-of-renewable-energy

SA best spot in world for solar park
07 October 2010


South Africa is planning to build a R150-billion (US$21.8-billion) solar park in the Northern Cape province which, according to a pre-feasibility study, has some of the best solar radiation conditions in the world.

This is according to Ira Magaziner, chairperson of the Clinton Climate Change Initiative, which is partnering with the government to bring the park on line.

At a recent press briefing in Johannesburg, Magaziner said the study found that the strong and consistent sunshine in the province, large tracts of suitable and available land and proximity to electrical transmission points made it the ideal location for a solar park.

Further advantages include the availability of water from the nearby Orange River and easy access to a good road network and airport.

The park will be set up in sections over the next nine years, but the first portion could be operational as early as 2012.

Park spinoffs
Magaziner was in South Africa for the official announcement of the Solar Park Investors’ Conference planned for 28 to 29 October this year. The conference will be key to securing finance for the project – most of which is hoped to come from the private sector.

The multibillion-rand facility will be built over thousands of hectares and provide 5 000 megawatts (five gigawatts) of power, which will be fed into the national electricity grid.

Considering that one of the largest solar parks in the world today, the Olmedilla Photovoltaic Park in Spain, generates 60 megawatts of power on a sunny day, the South African version will be in another league.

The spinoffs of such a large-scale development are job creation, greater demand for locally manufactured solar components and a more stable power supply – which will also be kinder on the environment as there will be less dependence on fossil fuels.

Solar power has been slow on the uptake in the past, as South Africa has largely used its vast coal seams to produce electricity. But with coal being an expendable resource, and coal-fired plants being heavy pollutants, solar is fast becoming a viable alternative.

Because the South African solar park will use technology that is able to meet peak and baseload power demands, it will also help relieve pressure on the national grid.

With rapid economic expansion and a growing population, the country has to create an additional 40 000 megawatts of power over the next 20 years, according to the Department of Energy. But it can’t do this by relying on only one source, hence the department’s decision to turn to a mix of energies – coal, nuclear and renewables – which include solar.

Solar to eventually rival coal and nuclear
According to Magaziner, the global solar industry is still in its infancy, with less than 25 gigawatts of installed generation capacity worldwide, but this should change over the next decade.

Increased use of new, improved technology and appropriate government policy could make the price of solar competitive with fossil fuel-fired power, he added.

Unlike coal-fired or nuclear stations, large-scale solar plants can be built in increments, spreading the cost over time. Once operational, they are very cheap to operate, Magaziner said.

By 2020 solar power should be less expensive than it is today, as there are opportunities to cut costs through engineering improvements. In contrast, the cost of coal-fired power is likely to increase, as the technology is mature and fossil fuels price hikes are likely.

SA to become solar king
Sun, 24 Oct 2010 8:08


South Africa is planning to build a R150-billion (US$21.8-billion) solar park in the Northern Cape province which, according to a pre-feasibility study, has some of the best solar radiation conditions in the world.

(...)

The multibillion-rand facility will be built over thousands of hectares and provide 5000 megawatts (five gigawatts) of power, which will be fed into the national electricity grid.

Considering that one of the largest solar parks in the world today, the Olmedilla Photovoltaic Park in Spain, generates 60 megawatts of power on a sunny day, the South African version will be in another league.

http://business.iafrica.com/features/680664.html

Now THATS what we should be doing...

If we can even get this vaguely off the ground it will be an awesome achievement.

A further R174bn extended to Eskom
CAPE TOWN, SOUTH AFRICA
Oct 28 2010 16:08

The government has extended guarantees to state power utility Eskom to help finance its electricity generation programme, Finance Minister Pravin Gordhan said on Thursday.

Eskom is on a massive capacity building programme to bulk up its power grid and prevent future blacks, after a 2008 power crisis shut down mines and other industries, costing billions of rands.

"We have extended guarantees to Eskom by R174-billion. Eskom will now have R350-billion from government to enable it to continue with its build programme through 2017," Gordhan said in a presentation to a parliamentary committee.
Eskom has been struggling to find all the money it needs to pay for two new 4 800 MW coal-fired power plants.

The utility has said it will tap the US bond market in early 2011 for cash to pay for new power stations and other infrastructure desperately needed to avoid a power crunch.

Officials have warned of rolling blackouts from 2011 to 2016 unless extraordinary measures are taken to generate more power.

Financially sound
A senior Treasury official said Eskom is financially sound and will be able to service its debt.

"Backed by these guarantees ... when they complete (new power stations) Medupi and Kusile, the energy that is going to be generated by these power stations should actually enable Eskom to service its debt," Lungisa Fuzile, head of asset and liability management at the Treasury, said at the hearing.

Treasury Director-General Lesetja Kganyago told legislators it was necessary to allow foreign exchange to go out of South Africa to mitigate the recent appreciation in the rand. - Reuters

http://www.mg.co.za/article/2010-10-28-a-further-r174bn-extended-to-eskom

NGOs slam government’s proposed electricty mix
November 29 2010 at 09:14am
By Slindile Khnayile

REUTERS

The government's integrated resource plan (IRP) for this year has been heavily criticised, largely by civil society, which said it would be disastrous for the economy and the environment.

The government’s integrated resource plan (IRP) for this year has been heavily criticised, largely by civil society, which said it would be disastrous for the economy and the environment.

Speaking at the Department of Energy’s public hearings in Durban on Friday, a number of NGOs and community groups called on the state to scrap the plan and to start the process again. The IRP 2010 is a 20-year electricity plan.

The plan is currently out for public comment and will be presented to the cabinet next year.

Participants in the public hearings were unhappy mainly with the fact that the plan still included coal and nuclear. The majority said they would prefer the plan to rely mainly on renewable energy.

GroundWork’s Rico Euripidou lambasted the department’s talk about using clean coal, saying “everything about coal is dirty”.

Euripidou said the plan would drain the country’s economy to the benefit of energy-intensive users at the cost of the people.

“(It will) entrench inequality and poverty, sustain the bias for coal and nuclear over renewables for centralised over dispersed and locally controlled energy systems and for capital-intensive over labour-intensive options,” he said.

Euripidou said the plan would impose impossible costs from nuclear waste on future generations.

The IRP 2010 projects a scenario that would cost R860 billion, which would take the country’s energy mix in 2030 to 48 percent coal, 16 percent renewable energy, 14 percent nuclear, 9 percent peaking open cycle gas turbine, 6 percent peaking pump storage, 5 percent mid-merit gas and 2 percent imported hydroelectricity.

Alice Thomson of Earthlife Africa said the NGO rejected the plan in its entirety as there were major problems with it.

“The IRP plans to increase South Africa’s generation capacity from our existing capacity of 44 000 megawatts to 85 241MW. To see this in context, one must realise that the whole of Durban and Cape Town each consume 1 300MW. We believe that we do not need to increase generation capacity, instead we can decrease the energy intensity of our economy,” said Thomson.

“According to the IRP, the revised balanced scenario will cost R856bn, excluding costs to health and environment. We believe this is a gross underestimation of the costs - 10 gigawatts of nuclear power (which is close to the 9.6GW in the IRP) would cost R1 trillion, according to the Department of Trade and Industry’s Ipap 2 (Industrial Policy Action Plan). That’s only the nuclear energy.”

Department of Energy acting deputy director-general for nuclear and clean energy Ompi Aphane said while the government already had a nuclear policy, no decision had been taken on how and to what extent the country would increase nuclear power capacity.

The participants also complained about the composition of the technical team that advised the government when the IRP 2010 was drafted, saying it consisted of people in the energy industry only.

They also challenged the consultation process, saying it did not cater for low-income groups because the document was electronically based and it was produced in one language - English.

Aphane said: “It is not a secret that this is very technical work but to suggest that we deliberately tried to exclude any stakeholder is not true. We believe that in terms of expertise, there could well be room to expand.”

Other organisations that opposed the plan were the SA Faith Communities Environment Institute, South Durban Community Environment Alliance, KwaZulu-Natal Subsistence Fishermen, Clairwood Ratepayers Association, Geasphere, Ecopeace and the Paper Manufacturers Association of SA.

The government received support from the SA Sugar Association (Sasa), which highlighted its power generation capacity and how it could work within the IRP. Sasa said it could start supplying power from sugar cane from 2013.

Sappi said although renewable energy was the preferred technology, coal would remain the only viable option. The paper producer also emphasised its electricity generation abilities.

Aphane said the IRP was not cast in stone as it would be revised regularly. Comments can be submitted until December 10. - Business Report


http://www.iol.co.za/business/business-news/ngos-slam-government-s-proposed-electricty-mix-1.878638

NGOs slam government’s proposed electricty mix
November 29 2010 at 09:14am
By Slindile Khnayile

REUTERS

The government's integrated resource plan (IRP) for this year has been heavily criticised, largely by civil society, which said it would be disastrous for the economy and the environment.

The government’s integrated resource plan (IRP) for this year has been heavily criticised, largely by civil society, which said it would be disastrous for the economy and the environment.

Speaking at the Department of Energy’s public hearings in Durban on Friday, a number of NGOs and community groups called on the state to scrap the plan and to start the process again. The IRP 2010 is a 20-year electricity plan.

The plan is currently out for public comment and will be presented to the cabinet next year.

Participants in the public hearings were unhappy mainly with the fact that the plan still included coal and nuclear. The majority said they would prefer the plan to rely mainly on renewable energy.

GroundWork’s Rico Euripidou lambasted the department’s talk about using clean coal, saying “everything about coal is dirty”.

Euripidou said the plan would drain the country’s economy to the benefit of energy-intensive users at the cost of the people.

“(It will) entrench inequality and poverty, sustain the bias for coal and nuclear over renewables for centralised over dispersed and locally controlled energy systems and for capital-intensive over labour-intensive options,” he said.

Euripidou said the plan would impose impossible costs from nuclear waste on future generations.

The IRP 2010 projects a scenario that would cost R860 billion, which would take the country’s energy mix in 2030 to 48 percent coal, 16 percent renewable energy, 14 percent nuclear, 9 percent peaking open cycle gas turbine, 6 percent peaking pump storage, 5 percent mid-merit gas and 2 percent imported hydroelectricity.

Alice Thomson of Earthlife Africa said the NGO rejected the plan in its entirety as there were major problems with it.

“The IRP plans to increase South Africa’s generation capacity from our existing capacity of 44 000 megawatts to 85 241MW. To see this in context, one must realise that the whole of Durban and Cape Town each consume 1 300MW. We believe that we do not need to increase generation capacity, instead we can decrease the energy intensity of our economy,” said Thomson.

“According to the IRP, the revised balanced scenario will cost R856bn, excluding costs to health and environment. We believe this is a gross underestimation of the costs - 10 gigawatts of nuclear power (which is close to the 9.6GW in the IRP) would cost R1 trillion, according to the Department of Trade and Industry’s Ipap 2 (Industrial Policy Action Plan). That’s only the nuclear energy.”

Department of Energy acting deputy director-general for nuclear and clean energy Ompi Aphane said while the government already had a nuclear policy, no decision had been taken on how and to what extent the country would increase nuclear power capacity.

The participants also complained about the composition of the technical team that advised the government when the IRP 2010 was drafted, saying it consisted of people in the energy industry only.

They also challenged the consultation process, saying it did not cater for low-income groups because the document was electronically based and it was produced in one language - English.

Aphane said: “It is not a secret that this is very technical work but to suggest that we deliberately tried to exclude any stakeholder is not true. We believe that in terms of expertise, there could well be room to expand.”

Other organisations that opposed the plan were the SA Faith Communities Environment Institute, South Durban Community Environment Alliance, KwaZulu-Natal Subsistence Fishermen, Clairwood Ratepayers Association, Geasphere, Ecopeace and the Paper Manufacturers Association of SA.

The government received support from the SA Sugar Association (Sasa), which highlighted its power generation capacity and how it could work within the IRP. Sasa said it could start supplying power from sugar cane from 2013.

Sappi said although renewable energy was the preferred technology, coal would remain the only viable option. The paper producer also emphasised its electricity generation abilities.

Aphane said the IRP was not cast in stone as it would be revised regularly. Comments can be submitted until December 10. - Business Report


http://www.iol.co.za/business/business-news/ngos-slam-government-s-proposed-electricty-mix-1.878638

NGOs slam government’s proposed electricty mix
November 29 2010 at 09:14am
By Slindile Khnayile

REUTERS
.....Alice Thomson of Earthlife Africa said the NGO rejected the plan in its entirety as there were major problems with it.

“The IRP plans to increase South Africa’s generation capacity from our existing capacity of 44 000 megawatts to 85 241MW. To see this in context, one must realise that the whole of Durban and Cape Town each consume 1 300MW. We believe that we do not need to increase generation capacity, instead we can decrease the energy intensity of our economy,” said Thomson.

[/url]

:ohno: Sure, that's why we never even needed load shedding....oh, wait.

And where the heck do they get the numbers that Durban and Cape Town combined only use 2600 MW? Flip, one aluminum plant alone consumes 1000MW.

And while I agree coal is dirty, nuclear is the only feasible alternative. Wind and Sun are still too erratic and low producing to be viable, not to mention Wind power is not exactly green - US studies have shown the turbine blades massacre bird and bat populations in the area.

Don't look to South Africa for climate leadership at Cancún

IPS: Africa's biggest carbon emitter will align itself with other big developing economies at the UN climate talks in attempts to prioritise development over cutting emissions


IPS guardian.co.uk, Monday 29 November 2010 11.39 GMT

http://static.guim.co.uk/sys-images/Guardian/Pix/pictures/2010/1/8/1262983863321/Drax-001.jpg

South Africa's proposed Medupi coal-fired power station, which requires a huge $3.7bn World Bank loan, would be three times bigger than the UK's Drax power station. Photograph: James Cheadle/Loop Images/Corbis

South Africa is Africa's largest economy and the continent's biggest emitter of greenhouse gases. The country's emissions per capita are on par with those of the United Kingdom, and more than twice as high as China's emissions by the same measure.

South Africa is presently responsible for about half of Africa's emissions, with 80 percent of its estimated 400 million metric tonnes of CO2 coming from the energy sector alone.

Africa is expected to be disproportionately affected by climate change, with a global rise of two degrees Celsius - the acknowledged worldwide target - resulting in a possible four to five degree rise in many parts of the continent. Changes in temperature, quantity and distribution of rainfall have enormous implications for farming, compounded by weak infrastructure and the vulnerability of impoverished populations.

But going into negotiations at the U.N. Climate Conference in Cancun, it is likely that South Africa will align itself with other big developing economies, advocating an approach that prioritises poverty alleviation over any binding commitment to reducing emissions.

Ahead of the last 15th Conference of Parties to the U.N. Framework Convention on Climate Change in Denmark in December 2010, South Africa announced a voluntary commitment to reduce emissions by 34 percent below "business as usual" levels by 2020. This reduction is, however, conditional upon international support that is not certain to materialise.

South Africa's Minister for Water and Environmental Affairs, Edna Molewa, will be representing South Africa's interests at the 16th Conference of the Parties to the U.N. Framework Convention on Climate Change in Cancun, Mexico.

"We believe that it is quite important that as developing countries we also get an opportunity to allow development to happen because of poverty," Molewa says. "We need to allow space for us to actually introduce those emissions [reductions] over time, because developed countries have gone through the processes."

The country experienced rolling blackouts in 2008, severely impacting the mining and manufacturing sectors, and causing the cancellation of big energy-intensive projects. Securing an energy supply to support economic growth and reduce high levels of poverty remains uppermost for planners.

The government's second Integrated Resource Plan seeks to map out long-term energy and technology options for the South Africa, taking into consideration sustainability, security of supply, accessibility, affordability, security of supply and environmental impact.

The short-term answers are dirty: the coal-fired Medupi power station is expected to contribute 4,800 megawatts to the national electricity grid from 2012, and to emit around 26 million tonnes of carbon dioxide a year, despite employing supercritical coal technology, which is less polluting than older coal plants'. The subsequent Kusile station is projected to have similar outputs on both scores.

In its draft energy plan, government expects that by 2030, 48 percent of the total energy demand will be met by coal, 16 percent from renewable sources and 14 from nuclear generation, including the construction of six new nuclear power stations, the first of which would come online in 2023.

The draft plan also considers a "low-carbon scenario" which would involve an energy mix of 36 percent coal-sourced electricity, 32 percent renewables and 12 percent nuclear. But planners found that although this scenario would cut carbon emissions by 20 percent more, it would drive up costs by 50 percent than the "balanced scenario" the draft plan endorses.

Richard Worthington from the Worldwide Fund for Nature says that in South Africa there is a perception that a sustainable pathway forward puts jobs at risk. "But the evidence is clearly out there that a low-carbon economy is a more labour intensive economy," he says. "The less you rely on the concentrated energy of fossil fuels, the more likely you are to need more people working."

Greenpeace International and the European Renewable Energy Council have set out a vision for a low-carbon energy future involving increased efficiency, renewable energy sources and expanded reliance on combined heat and power generation. Greenpeace says its Energy [R]evolution scenario would secure power for economic growth while creating an additional 78,000 jobs in the energy sector by 2030. It would also reduce the country's emissions - 2050 emissions would fall by 60 percent as compared to 2005 levels.

An important challenge to green scenarios like this one is how quickly the cost to consumers per unit of renewable energy can be reduced to match the price of polluting energy: higher energy costs for either industry or the country's poor are viewed as unacceptable.

Although it is well-endowed with solar and wind energy resources, South Africa has not developed a robust renewable energy industry.

The Copenhagen Summit failed to reach a binding agreement on reducing emissions, primarily because of developed countries were unwilling to sign up to new commitments without matching commitments from the rising developing powers. Little progress has been made on this front during 2010 and few expect the Cancun summit to achieve a breakthrough.

But with South Africa hosting the 2011 round of climate change negotiations in Durban, Africa - and the world - will be looking for it to demonstrate leadership in reconciling development priorities and the drastic reductions in greenhouse emissions that the world needs.

http://www.guardian.co.uk/environment/2010/nov/29/south-africa-climate-cancun

Green energy producers ‘can generate 24000MW’

A possible 24 000MW of South Africa’s future electricity supply could be supplied by "green energy."

SISEKO NJOBENI
Published: 2010/12/07 07:02:55 AM

UP TO 24000MW of SA’s future energy requirements could be sourced from renewable energy and co-generation projects, the Department of Energy said yesterday.

This follows "a request for information" exercise with the industry.

The initiative is the first step in the proposed procurement of renewable energy from independent power producers under the renewable energy feed-in tariff programme.

Independent producers’ responses gave an indication of the private sector’s readiness to participate in SA’s renewable energy market.

The information would assist with the design of the proposed procurement process for private power, the department said.

It had initiated the exercise in September, targeting potential private developers of renewable energy projects. Potential developers of wind, solar, biomass, biogas, small hydropower and landfill gas or co- generation projects indicated that about 20000MW could be procured from the private sector. Another 4000MW could be produced through co-generation.

According to the department’s acting deputy director-general for electricity, nuclear and clean energy, Ompi Aphane, the responses would influence the second integrated resource plan, which directs the expansion of electricity supply over the next 20 years.

"We will use the request for information as some form of input to the plan," he said.

The plan sets the target for the contribution of renewable energy contribution in the next 20 years at 7200MW or 16% of the total.

Responses to the exercise indicate that wind power could account for 70% of the 20000MW capacity, solar photovoltaic 15% and concentrated solar power 5%.

The rest would come from biomass, hydro, landfill gas and biogas projects.

Mr Aphane said respond ing companies had provided data on their readiness, proposed sites and commitment of financiers.

However, it appeared most were not ready for connection to the grid. Fewer than 30 of the 384 that responded, said they had received an indicative quote for connection.

Certainty over the costs of grid connection is key in the finalisation of power purchase agreements.

Mr Aphane said discussions with Eskom had shown that connection capacity for independent power producers using renewable energy was sufficient until 2016.

njobenis@bdfm.co.za


http://www.businessday.co.za/articles/Content.aspx?id=128743

About time government admitted this was a disasterous initiative...

---------------

Government shuts regional power distributors

Cabinet has announced it has shut down REDS with immediate effect according to Minister in the Presidency, Collins Chabane

WYNDHAM HARTLEY
Published: 2010/12/09 01:27:32 PM


Government has terminated the creation of regional electricity distributors of REDS with immediate effect.

Minister in the Presidency Collins Chabane told a post cabinet news briefing today that "Although the Electricity Distribution Industry Holdings (EDIH) had made significant progress in establishing the REDs, Cabinet approved the recommendation that the Department of Energy takes over the programmes previously executed under the EDIH mandate. The Department will review the whole electricity value chain with a view to developing a holistic approach to revitalize electricity infrastructure, energy security as well as the financial implications."

He also included a number of focus groups and an international survey.

Chabane also said cabinet had approved a draft carbon tax bill.

That’s after Eskom and Sasol topped a global list of South Africa’s worst polluters.

They accounted for 290 million tonnes of carbon dioxide.

The proposed tax will aim at influencing consumer behaviour through a pricing mechanism.

Government is also considering three additional tax options including a direct tax on actual measured emissions, a fossil fuel input tax based on carbon content and an output tax that could be applied to facilities that burn bad fuel.


http://www.businessday.co.za/articles/Content.aspx?id=129092

Eskom casts wide power buy-back net to deal with two years of acute tightness

By: Terence Creamer
6th January 2011

State-owned power utility Eskom is casting a wide power buy-back net as part of efforts to close a possible supply/demand shortfall of 6 TWh this year and 9 TWh in 2012/13, without having to resort to rotational load shedding– 9 TWh is equivalent to the electricity consumed by a large city such as Cape Town in a year.

CEO Brian Dames indicated on Thursday that the utility was even going so far as to approach large shopping malls and hospitals with generation capacity to offer them short-term incentives to use their capacity should the system become overextended during the next two years.

Power demand is expected to expand by 2% during 2011 from sales of 205 364 GWh last year and Eskom is forecasting a winter peak of around 38 000 MW – with imports, Eskom has a nominal capacity of nearly 43 000 MW, and views anything less than 2 000 MW of reserves as potentially problematic.

Engineering News Online understands that deals could be concluded with mega malls in Gauteng, KwaZulu-Natal and the Western Cape in the not too distant future and that the incentive would probably be higher than the R118/MWh it costs Eskom to run its open-cycle gas turbines, in the Western Cape. However, these contracts would only be triggered in instances of dire system stress.

Eskom is also in talks with the Johannesburg and Tshwane municipalities in a bid to secure an additional 200 MW of coal-fired capacity in the near term, as well as with those municipalities that have installed gas turbines, which could add 100 MW of peaking capacity.

These contracts would be additional to the 287-MW of cogeneration and own-generation capacity that it had already secured from Sasol, Ipsa and Sappi, as well as the additional 88 MW that will be contracted with two other generators in the coming weeks. These contracts were concluded under the medium-term power purchase programme, which was now closed.

DEMAND AGGREGATOR

Senior GM for integrated demand management Andrew Etzinger added that the utility was also close to finalising commercial negotiations with an international ‘demand response aggregator’, which could facilitate the purchase of as much as 500 MW from small industrial and commercial entities during the 2011 winter peak and beyond.

The aggregator, whose identity should be made known within weeks, would supplement the direct work Eskom was doing with the municipalities, shopping centres and hospitals, as well as its already established demand-market participation (DMP) scheme, which incentivises large consumers to reduce demand and/or to shift loads.

Eskom was currently revising the DMP incentive, which had been made less attractive following successive tariff increases over the past few years. At present, only 300 MW of DMP was contracted, far lower than the 600 MW contracted in recent years. But Etzinger said that he was confident that, once restructured, the scheme would once more secure 600 MW of participation.

All told, Eskom is hoping to lock in buy-backs worth 2 000 MW for the coming two years as part of a larger ‘virtual power station’ concept unfolding at the power-stressed utility. Further components involve residential demand-management solutions, energy efficiency programmes, demand-side management programmes, as well as a mandatory energy conservation scheme (ECS).

The ECS, which when first mooted caused widespread alarm among domestic businesses, would target South Africa’s 500 largest electricity users and would act, Eskom says, as a further “safety net”.

The objective was to achieve a 10% reduction against agreed 2007 baselines from industrial customers consuming more than 25 GWh a year. Currently, the scheme is voluntary and about 5% worth of savings had been recorded against the baselines. But Eskom and the Department of Energy would seek to make it mandatory in the coming months.

Operations and planning division MD Kannan Lakmeeharan reported that the discussions would take place at the National Economic Development and Labour Council and that savings achieved against baseline would be recognised.

Eskom argues that all three mechanism are required, owing to its internal calculations showing that South Africa’s electricity shortfall could peak at 9 TWh, the equivalent of 1 000 MW, in 2012.

“The supply/demand balance will be tight for the next two year and we are taking action to keep the lights on. But we cannot do it alone,” Dames concluded.

http://www.engineeringnews.co.za/article/eskom-casts-wide-power-buy-back-net-to-deal-with-two-years-of-acute-tightness-2011-01-06

[b]S.Africa's PetroSA approves $1 bln offshore gas project(/b]

CAPE TOWN, Sept 28 (Reuters) - South Africa's national oil company PetroSA said on Tuesday it has approved a $1 billion offshore gas project that it expects will start producing by the first quarter of 2011.

The offshore gas field, called "FO" was located off the south coast and has in the region of 1 trillion cubic feet (TFC), with an upside of 2-3 TFC, the company said.

"Our next project is focusing on the FO project, which is the gas field approximately 40 kilometres (25 miles) away from the existing platform," Sandro Borean, PetroSA's regional manager for new ventures upstream told an African energy conference.

"It's a very large project, it's a billion dollar project or thereabouts and we anticipate first gas in the first quarter of 2013. This has been approved by the board recently," he said.

South Africa has limited gas reserves, mainly located in the south coast's block 9 region, where the FO field is, and is scrambling to secure supplies to one of the world's largest gas-to-liquids refineries in Mossel Bay.

PetroSA operates one of the world's largest gas-to-liquids refineries at Mossel Bay in South Africa and holds exploration acreage in Gabon, Equatorial Guinea, Egypt, Namibia and Mozambique.

The energy company my father used to work for was involved in a SA gas project many years ago. Currently, here in Texas, natural gas formations thought to be uneconomical are being brought into production due to improved drilling techniques and technologies. Do you think that this could be the case for formations in SA? Also, does anyone have any statistics on how much power is produced from natural gas plants?

SA has vast off-shore gas potential. The deep-water reserves off the South African west coast is estimated to be 200m - 1 billion barrels for each structure. The deep off-shore estimate of Southern Oueteniqua is 4 billion barrels. The east coast (directly offshore from Durban, referred to as the Durban Basin and Tugela Cone, in particular), is virtually unexplored. Estimates there are 300-700m barrels. However, I think accessing this gas is very challenging because of the underwater topography and depth. See: www.kgu.or.kr/download.php?tb=bbs_017&fn...pdf&rn=wpc...

Before we consider fracking the Northern Cape for gas, we should explore / fully exploit wind potential. I think cabinet needs to rethink its energy strategy...

-------------

Nersa move shows wind costs falling — chamber
According to the Chamber of Commerce renewable energy costs are falling
SISEKO NJOBENI
Published: 2011/03/25 07:06:01 AM

THE National Energy Regulator of SA’s (Nersa’s) proposed decreases in renewable energy feed-in tariffs confirm that the costs of alternative energy are falling, the Cape Chamber of Commerce says.

The chamber joined widespread condemnation of the proposed changes in the feed-in tariffs, which are likely to discourage investment in the sector.

Cape Chamber of Commerce president Michael Bagraim said yesterday that electricity from wind turbines would be cheaper than Eskom grid electricity in four years’ time.

"This raises questions about government policy and why Eskom plans to spend so much money on new coal and nuclear power stations when wind energy will be cheaper at the point of generation."

Mr Bagraim said Eskom now sold electricity for an average price of 41,8c a unit, with further 25% increases on the way. "That will take the cost of Eskom electricity to just over R1 a unit while, according to the new Refit tariffs, wind power will cost 95c a unit. In these circumstances it becomes very difficult to understand how the Cabinet could have approved the new energy plan which includes more coal and nuclear power," he said.

The chamber’s energy portfolio chairman , Peter Haylett, said the reduction in the feed-in tariffs would be a blow to the alternative energy industry, "where many investment decisions have already been made".

Meanwhile, the South African Wind Energy Association (SAWEA) said the new tariffs would knock investor confidence in the South African energy industry.

The strong views expressed by the renewable energy industry since Nersa’s publication this week of a consultation paper on the review of the feed-in tariffs raise the possibility of potential investors turning their backs on the industry.

Feed-in tariffs are generally used to encourage investment in renewable energy technologies such as wind and solar.

"The tariffs announced in 2009 were intended to stimulate a local renewable energy supply industry and have been effective in doing so," SAWEA chairman Mark Tanton said. However, "the decision to revise the tariff at the 11th hour … came as a complete shock".

Nersa will hold public hearings on the review of the feed-in tariffs on May 5.


njobenis@bdfm.co.za

http://www.businessday.co.za/articles/Content.aspx?id=138203

Shell may spend R1.4bn on Karoo plans


Mar 28 2011

Cape Town - International petroleum group Shell could spend up to $200m (about R1.4bn) in the exploration phase of its plans to extract shale gas in the Karoo.

Shell South Africa chairperson Bunong Mohale told I-Net Bridge/BusinessLIVE this after leaving a public participation meeting with interested persons about the controversial issue on Friday.

Ordinarily Shell spends up to $15m (about R105m) per well. The costs are very variable as it depends on how deep the well is, how much water has to be used and other things, Mohale said.

Shell has applied for a license to explore for shale gas in the ecologically sensitive Karoo region.

The exploration involves a controversial process called n hydraulic fracturing, or, fracking in which water and sand are pumped into a well in order to get the gas that is contained in soft rock to flow freely. While the prospect of exploiting such a resource may go some way in securing the country's energy supplies, it can lead to pollution of the underground water system and may impact land use for years.

Mohale said that Shell expects the Petroleum Agency of South Africa to give it either a yes or no in August as this would meet the 120 day period granted to prepare itself in terms of the law.

This preparation includes holding public meetings such as this and completing an environmental management plan.

During Friday's meeting Mohale, other Shell South Africa officials and consultants from Golda, the agency advising the corporation, received a cordial but antagonistic audience.

Members of the public included farmers, activists and others with some kind of interest in the Karoo.

One of the audience members was well-known environmentalist and lawyer Lewis Pugh who pointed to Shell's record in the Nigerian Delta.

Shell has spilt nine million barrels of oil in the Niger Delta, which is twice as much as BP has spilt in the Gulf of Mexico, Pugh said to resounding applause.

Pugh made the point that the life of the wells would be at best nine years, but the pollution it would cause would last much longer.

Questions from the audience ranged from why Shell would not say anything yet about the chemicals it would pour into the wells or the naturally occurring chemicals, damage that would be caused and what if the local communities asked Shell to stop its activities.

Mohale committed Shell to being a ?good corporate citizen and said that it would stop its activities if asked by the local communities.

Members of the audience complained that while Shell appeared to be meeting the letter of the law in terms of holding public consultations, they complained that the documentation was complex and that it was not getting to the communities that were going to be directly affected.

Applications have been received by the Petroleum Agency of South Africa for explore some 220 000 square kilometers of the Karoo. Shell has asked to explore about 90 000 square kilometers mainly located in the western part of the basin.

A lot of people believe that fracking leads to contamination of groundwater. There is a big fight going on in Pennsylvania over it at the moment.

If large enough deposits of natural gas are found then perhaps Eskom can construct natural gas plants instead of coal. http://www.global-greenhouse-warming.com/gas-vs-coal.html

Also, I am surprised no one has made any Hank Hill jokes yet...

WAY to go flippen protesters! PS - stop burning things and have dialogue!! :ohno:

Eskom shuts Medupi site
Wed, 11 May 2011 6:58

A protest at the Medupi power station construction site near Lephalale, in Limpopo, led to the closure of the site on Tuesday, Eskom said.

"The protest action by the workers, who are employed by contractors on the Medupi project, resulted in some damage to vehicles, but there were no injuries," spokeswoman Hilary Joffe said in a statement.

She said of the 9000 workers employed at the site, 500 participated in the protest.

According to Limpopo police, "thousands" of protesters torched two buses and damaged four vehicles.

"Residents alleged that Eskom is employing foreign-experienced boilermakers and not considering the [local] residents for the positions," Brigadier Hangwani Mulaudzi said.

Two buses were set alight and two police vehicles and two cars damaged. Police had deployed members of the public order policing unit to stabilise the situation. Mulaudzi said police condemned violence by people who did not want to engage in dialogue when they had problems.

"As the police, we will not hesitate to take action against anyone who transgresses the law," he said.

No arrests had been made and no injuries reported.

Tuesday's incident followed the closure on Friday of Eskom's construction site at Kusile in Delmas, Mpumalanga, also due to a protest.

Joffe said the Medupi project was still on track for its scheduled power-up at the end of 2012, despite the disruption.

If true, than this could be HUGE for South Africa and will rocket us out of the doldrums.

-------------------------------------------------------------------------------
Shale gas could end SA's oil dependence

May 29 2011 16:06

Professor Philip Lloyd, head of the Energy Institute at the Cape Peninsula University of Technology gives a new perspective to the emotional debate on shale-gas extraction.

Johannesburg - South Africa’s shale gas reserves in the Karoo represent the world's fourth-largest resource of this valuable form of energy and are sufficient to end the country's dependence on crude oil.

If Shell and Sasol’s controversial exploration work should result in the shale-gas resources being developed, this could have far-reaching consequences.

It would not only create hundreds of thousands of jobs, but also break Eskom's dependence on coal to generate electricity, dramatically reduce South Africa's carbon bisulphide emissions, and even make hundreds of small-scale manufacturing industries sustainable.

That is the view of Professor Philip Lloyd, who heads the Energy Institute at the Cape Peninsula University of Technology, and gives a new perspective to the emotional debate on shale-gas extraction since Shell applied in February for an exploration licence for this valuable energy resource in the environs of Graaff-Reinet.

If the exploration indicates that the gas can be exploited, this will totally alter the structure of our country's economy, said Lloyd during a debate in Midrand. The debate was being held on the temporary prohibition of scale-gas exploration imposed by government in March.

Lloyd believed Shell should be congratulated for its willingness to invest in this expensive process, although he also reckoned that operations needed to be strictly regulated.

If Shell should succeed with its exploration, said Lloyd, jobs would be created on a scale never before seen in South Africa. It would also bring about a large decline in greenhouse gas emissions in this country.

According to the United States Geological Survey (USGS), which maintains global surveys of energy resources, Karoo shale gas is the fourth largest resource in the world. It was originally estimated that there was about 1 000 trillion cubic feet (tcf) of shale gas in the Karoo, but geological data collected over the years have reduced this to about 450 tcf.

The tcf unit is an abbreviation used in oil and exploitation to indicate the size of gas resources. It represents a million, million cubic feet.

This is enormous. Mossgas was built on the supposition that there was at most 1 tcf in the undersea gas resource feeding that plant.

If the Karoo resource is even close to the amount indicated by the USGS, South Africa would be able to erect gas turbines for electricity generation all along the coastline. This would end the country’s dependence on coal to generate electricity.

The exploration work on developing infrastructure to exploit the gas would take about five years. Building gas turbines to generate electricity would take at most two years.

Shale gas is also the best available reducing agent for iron ore. New steel works could be created on the Sishen-Saldanha iron ore route, as “beautiful steel” could be manufactured using it, said Lloyd.

More than 40m tons of iron ore is exported along the Sishen-Saldanha route to Asia and Europe. Lump iron ore from Sishen is some of the most sought-after iron ore globally, but cannot be processed into steel here because of the cost, particularly that of energy for heat for the reduction process.

Lloyd said that he considered the country's shale-gas resource large enough to feed several gas-to-liquid-fuel plants to produce fuel. This could in fact make South Africa totally independent of imported crude oil, he said.

Natural gas is also exceptionally suited as an energy resource for manufacturing in small industries such as those for bricks, tiles, cement, ceramics, bakeries and galvanised sheet metal.

Many years ago Sasol [JSE:SOL] began importing natural gas from Mozambique to Secunda. It was a relatively small quantity, but the demand became so big that Sasol recently decided to increase imports by 50%. By-products of Sasol's sales, according to Lloyd's research, have already stimulated 350 new small companies.

One of the other participants in the debate, Dr Chris Hartnody, a geologist from Umvoto, a non-governmental organisation, warned that the hydrological fracturing (fracking) processes used to exploit shale gas could lead to earthquakes in the Karoo. But Lloyd pointed out that the Karoo was “accustomed” to drilling – there are hundreds of water boreholes in the semi desert region. He also rejected the widespread environmental fears of pollution.

There is little evidence that fracturing has ever polluted underground water. Shale rock is extremely deep and the boreholes used for hydraulic fracturing have to be absolutely impermeable – or the shale rock cannot be fractured, said Lloyd.

Boreholes have up to five layers of steel and cement casings to ensure that they are 100% impermeable.

Lloyd has researched the environmental issues regarding hydraulic fracturing for shale gas in the US and Canada. Most environmental problems arise from the dumping of secondary waste products, but this can be controlled through regulation, he said.

There is little evidence that fracking contaminates underground water sources, he declared. Underground water is almost always shallow, while shale gas is very deep.

The holes are usually 5 000 to 7 000 metres underground, and fracking is done in horizontal stopes at the deepest point.

Wow, that is a totally different perspective. As you say, if true, this would be a massive step forward for South Africa.

Its a very different perspective.. but it blithely ignores the LARGE volumes of water that are needed for this process, esp in a country that is water scarce at the best of times...

And I'm damn sure I've seen a report recently that shows the ground water of an area that has been "frac'd" to have become contaminated...

I'm all for industrial progression, but it must not be at the sake of ecosystems like the Karoo.

...not to mention the impact on the SKA bid.

^^ No necessarily. I attended the talk and I actually agree with the pro-frackers. The acquifers which contain drinkable water lie at best a few hundred feet underground, whereas the water that might be needed is much deeper. The so-called 'brackish water'. Not only that, the water can be recycled and used over and over, thirdly the water is only needed initially to 'frack' not for the continuous operation of the well. Philip Lloyd said one well will need something like 9 swimming pools worth of water over its lifetime, sure its a lot but its not gonna deprive SA of all its water.

Regarding the water contamination reports, many of the cases refer to drilling companies dumping their waste water illegally, not contamination from badly created wells. In fact the companies have an incentive not to create sub-par wells that will leak out contaminants as this would mean valuable gas will be lost.

Lastly 'fracking', according to the experts also allows to access the lower lying water that would otherwise have been unreachable so for all we know, it just might unlock more water resources for the Karoo.


BTW, at the end of the debate the vast majorioty of attendants voted in favour of fracking (80 vs 30)

...not to mention the impact on the SKA bid.

Not even, they've already done measurements on rigs and trucks to gauge how much radio-interference they give off, and they only have to stay clear by about 9 - 30 km's. BTW SKA will be hundreds of K's away, the fracking area is around Graaf-Reinet whereas core of SKA is Carnavon (sp?)

Report from the UK Parliament’s Energy and Climate change committee. After visiting US installations and taking into account objections to fracking by the World Wildlife Fund, the UK parliament found:

“There is no evidence that the hydraulic fracturing process itself poses a direct risk to underground water aquifers. That hypothetical and unproven risk must be balanced against the energy security benefits that shale gas could provide to the UK. We conclude that, on balance, a moratorium in the UK is not justified or necessary at present. But evidence must continue to be collected and assessed. We recommend that the Department of Energy and Climate Change monitor current drilling activity in the Bowland Shale formation extremely closely during its early stages in order both to assess the likely environmental impact of large scale shale gas extraction in the UK and also to promote public confidence in the regulation of the activity.”


source : http://www.parliament.uk/business/committees/committees-a-z/commons-select/energy-and-climate-change-committee/news/new-report-shale-gas/

Its an interesting option, don't get me wrong...

But there seems to be alot of companies and guavamint officials trying to ride rough-shod over peoples rights etc for a few bucks.... and that will never help their cause...

If frac'ing and the SKA can co-exist AND they can prove that there is minimal to no damage to the Karoo ecosystem... then I'm all for this option BUT the onus on the proof must lie with the companies wanting to do the frac'ing....... there mustn't be a presumption that they're being all sweet and innocent when they say it doesn't.

^^Fair enough, I just think the 'fracking' debate has generated more heat than light so far. I might be wrong and fracking might be found to be enviromental devastating but I think we have nothing to lose if we investigate the technique properly before we take it off the table forever.

Now imagine gold digging in Joburg was forbidden in the day, would we have had a Gauteng today? Would SA have been the biggest economy on the continent? I think not. It would have been a dusty plain with koppies. The advantages totally outweigh the disadvantages if managed properly. South Africa would be the darling of the world and this gas will give us immense power on the world stage. Either this, or a fossilic wasteland- that the Karoo is already.

Cape Town could end up like Perth, where the mineral boom of Western Australia is centred comercially. CT could be the new Dallas by the Sea! - Or for that matter a place like Kimberley getting a new lease on life, and providing much needed growth and oportuninty to Northern Kaapenaars.

Cape Town could end up like Perth, where the mineral boom of Western Australia is centred comercially. CT could be the new Dallas by the Sea! - Or for that matter a place like Kimberley getting a new lease on life, and providing much needed growth and oportuninty to Northern Kaapenaars.

That's what I'm saying!! We're so out of ideas in SA, we aint thinking out the box. We're quick to condemn anything that will mean development and industrialisation except for malls, botique hotels and restaurants. All those are nice but they're a derivative of a sound and strong primary economy. And lastly, yes I appreciate the desolation of the Karoo like the next man, but the place is EFFING humongous and mostly empty. Perfect place to be drilling for gas, IMO.

This (if Gas is indeed found) will be a game changer for the W.Cape, it has rare earth minerals, saldhana-sishen iron ore, mossgas. All these operation would be supercharged with the discovery of gas in the Karoo. It will make the province extremely wealthy and consequently SA as well.

Please don't say Cape Town could end up like Perth! Perth should be so lucky to ever be like Cape Town.

But yes, in terms of a mineral resource type boom, it would certainly project this part of the country up the economic ladder...

^What I was thinking. What is "Perth"?

^^Obviously we're referring to its incredible wealth. Maybe it will be like Melbourne, I think that's a better example...

I used Perth as the Australia example of a city geographically isolates from other cities, on the South West outpost of a continent, with an rugged hinterland, dry climate, beaches and winelands, and in Perths case, an headquarters in the making for the mining sector that uses the convenience of this large city in proximilty to the mineral weealth being untapped in the western outback. I am obviously aware of what Cape Town IS.. I'm from here lol. - its not to reduce the lovelyness of CT to a less impressive, more drab comparison of Perth as a city. - more its comparative location and the possible similarities in economic drivers of mining/mineral exploration that keep Perth ticking along at the moment to spite is isolation

There is a proposal that i can neither confirm nor deny that the Gaia Power Group (http://www.gaiaspower.com/) is in discussions with the national, provincial and local government spheres to build a pilot wave energy plant along the west coast. I can also neither confirm nor deny that they are in discussions with portnet to expand many ports around the country.

Well I'm going to take a MASSIVE flyer on this one..... but you are either family of Peter Jordaan or you work for the company...

^^so you're basically telling us that those things are the pipeline? If yes just smile :)

they're in the pipeline pending the outcome of discussions.

well untill the government publishes the feed in tarrif regulations its illegal to produce power for sale to the national grid. Thats whats holding back SA and stopping private investment in power genration.

So while we have load shreding and other Power related issue, teh government sits on its arse and spoon feeds Eskom to keep a manopoly.

Yup...

I would love to be able to feed power back to the grid, because I would love to be able to take me house "off-the-grid" on a semi-permanent basis.... and in our climate there are lots of ways to do it.

If memory serves me correctly, you can feed power back into the grid but you don't get paid for it. There was a guy in Somerset West (or somewhere) that did that a couple of years back.

Well there is no point in that....

I need to be reimbursed for my effort thank you very much, either in cash or in credit for power for the times when I would need to pull it from the grid

I'll rather just supply myself with power then, and to the black market ofcourse. Anything goes in SA in anycase.

no its illigal to feed back as per the law, law needs to change first then the regulations regarding the feed in tarrifs then the private investment

So does that mean you HAVE to disconnect yourself from the grid if you produce your own power? A little archaic. A little stupid too.

88 wind farms for the Cape
17 Jun 2011

Applications for at least 88 wind farms have been received by the Eastern and Western Cape authorities and some of these wind farms are expected to have as many as 600 turbines located on them.

According to figures submitted to the Department of Environment Affairs there are 40 wind farms likely to be erected in the Western Cape and if these are approved, about 2 800 turbines will be installed around the province.

At least five of the proposals for new wind farms have not stipulated how many turbines they are likely to build to supply electricity to the provincial grid.

There are 31 applications for wind farms in the Eastern Cape.

Each wind farm application has to be accompanied by an environmental impact assessment. Each turbine is between 80 metres and 120 metres tall, the height of a 20-or 30-storey building.

The wind farms sites are all reasonably close to the national electricity grid but are scattered throughout the provinces and sited in places where there is a consistent supply of wind.

Many of them are planned for spots along the windy West Coast stretching from Darling (about 60 km north of Cape Town) to Vredendal on the Olifants River, 300 km away from the city.

There are eight wind farms proposed for the Garden Route, four around Swellendam, two near Mossel Bay and fiver in the Overberg. There are also three farms planned for Caledon and two in Bredasdorp.

The smallest wind farm application is at Albertinia where just six turbines are likely to be built. The biggest wind farm is expected to rise at Middleton near Bedford in the Eastern Cape where 685 turbines will be built if the province approves the plan.

Several wind farms are planned for the Karoo and many of these are also large. Outside Beaufort West one farm will have about 275 turbines while another near Laingsburg will comprise 400 turbines.

The government’s Integrated Resource Plan 2010 says that 19,7% of new electricity generation will come from wind power as part of its plan to stop the country’s reliance on coal-fired electricity generation in the future.

While there has not been much public response to the wind farms, some communities have already lodged objections against the planned wind farms and one project, in Brittania Bay, has been delayed because of opposition from residents of the town.

Source: Property24 (http://www.property24.com/articles/88-wind-farms-for-the-cape/13668)

Wow, Eastern Cape is actually keeping up with W.Cape in something! Nice...

wow im shocked at the scale of these. lets hope they get approved and underway ASAP

How did all of these pop up at the same time? Great news, especially there are so many applications :)

Leaving Oil in the Soil

By PATRICK BOND

There's no way around it: to solve the worsening climate crisis requires we must accept both that the vast majority of fossil fuels must now be left underground, and that through democratic planning, we must collectively reboot our energy, transport, agricultural, production, consumption and disposal systems so that by 2050 we experience good living with less than a quarter of our current levels of greenhouse gas emissions.

That's what science tells our species, and here in South Africa a punctuation mark was just provided by a near-disaster in Durban – host of the world climate summit, four months from now – during intense storms with six-meter waves last week. A decrepit 40-year old oil tanker, MT Phoenix, lost its anchor mooring on July 26 and was pushed to the rocky shoreline in Christmas Bay, 25km north of the city.

The shipwreck is in the heart of a beautiful albeit class-segregated tourist and retirement site, Durban's North Coast, that just two weeks earlier held an Association of Surfing Professionals (ASP) world competition, Mr Price Pro. That event boasted some of the best waves ever seen in ASP history, said contestants.

But cold winter swells from marine hell reemerged just when MT Phoenix was being towed into Durban harbour for confiscation, having lost its engines a few hundred miles down the coast. According to Cathleen Jacka of the maritimematters.net website, the incident confounded the South African Maritime Safety Authority (SAMSA), what "with hints at a deliberate beaching; the possibility of a mystery stowaway still hiding onboard; uncertainty as to the true identity of the owners and even that the vessel was scrapped in India last year." A SAMSA official observed that the 15-member crew "seemed inexperienced in the basic actions required to stabilise the vessel's position" and remarked, "It would not be the first time that an unscrupulous ship owner was prepared to sacrifice a vessel in attempt to realise the insured value."

Except that there was apparently no insurance for the MT Phoenix, since Lloyds took it off the books late last year, and allegedly it was on its final trip, from West Africa to India's ghastly ship breaking graveyard. The owner, Suhair Khan of Dubai, stopped taking calls, leaving South Africans to bear the risk of 400 tons of oil spilling if the ship broke on the rocks. Estimates of the heroic rescue operation's cost to the taxpayer easily run into the millions of dollars, but thankfully the crew was saved and oil was laboriously pumped ashore.

Offshore drilling in the 'remarkably stable' (sic) Agulhas Current

However another potential oil disaster looms in this very location, thanks to South African government energy bureaucrats. On May 5, the Petroleum Agency of SA began authorizing seismic oil surveying by a dubious Singapore-registered company, Silver Wave Energy, in water depths ranging from 30 meters to two kilometers. By comparison, BP's Deepwater Horizon platform in the much calmer Gulf of Mexico drilled 1.5 km down to the seafloor surface.

Silver Wave Energy's primary owner is Burmese businessman Min Min Aung, who is tight with the junta that still rules there, according to reliable reports. Exploitation of oil and gas in Burma's Andaman Sea has long been controversial (my grandfather was deputy warden there during brutal colonial times), and when Unocal – now Chevron – built a pipeline to Thailand, it did such enormous damage to people and the environment that local villagers, supported by Earthrights International, successfully sued the firm for $30 million.

Since 2007 the Arakan islands on Burma's Bay of Bengal coast have been the main site of intense conflict, as Jockai Khaing from Arakan Oil Watch told me last week, and again Aung is a key player. Silver Wave has also been exploring dubious extraction projects in Russia, Sudan, Guinea-Conakry, Indonesia and Iraq, but in spite of sanctions against Burma (supposedly supported by South Africa), Aung received PetroSA's endorsement to explore 8000 square km stretching from Durban to SA's main aluminum-smelting city, Richards Bay.

Silver Wave simultaneously announced a $100 million oil search in the fragile Hukaung Valley in northeastern Burma, and if the company carries out its initial plans, this will threaten local villagers as well as endangered tigers, Himalayan bears, elephants and leopards. Although the area contains the world's largest tiger reserve, according to reporter Thomas Maung Shwe of Mizzima news service, "the Burmese regime has encouraged logging, gold mining, large scale farms and the building of factories inside." As the scandal grew, Silver Wave denied what its own press release had announced, but conceded it would drill near the reserve.

A company this dastardly is a high risk, and to prove the point, Silver Wave's environmental impact document includes a description of the notorious Agulhas Current, which begins at the Mozambique border: "Compared to other western boundary currents the Agulhas Current adjacent to southern Africa's East Coast exhibits a remarkable stability." Huh? In reality, the Natal Pulse races down the Agulhas a half-dozen times each year, pushing 20km per day. It is one reason Durban's coastline hosts more than 50 major ship carcasses. Creating havoc further south on the Wild Coast, the Pulse contributes to the rouge waves that have sunk 1000 more vessels in what is considered one of the world's most dangerous shipping corridors.

Susan Casey's book The Wave pays Agulhas this respect: "Crude, diesel, jet fuel, liquefied natural gas: oil in all its forms was heartbreaking, infuriating and all-too-common sight in the ocean. Supertankers, behemoths that couldn't make it through the Suez Canal, swung down from the Middle East, took their chances hopping a ride in the Agulhas, and met their share of disasters. Salvagers used every tool at their disposal to prevent the damaged tankers from gushing out their contents, especially in fragile near-shore environments, but sometimes the battle was lost."

South Africa's petrochem armpit

If, thankfully, the beaches at Christmas Bay were saved from a spill this week, others have not been so fortunate. Just offshore South Durban's Cuttings Beach, a few kilometers from where I'm writing, we witnessed a significant 2004 oil spill of five tons at the Single Buoy Mooring, the 50-meter deep intake pump that feeds the refineries with 80 percent of SA's crude oil imports. Onshore, corporate pollution standards are so lax that the rust-bucket structures regularly spring disastrous leaks and explode.

Daily, poisons are flared onto thousands of neighbouring residents. The Indian, coloured and African communities suffer the world's highest-ever recorded asthma rate in a school (52 percent of kids), as Settlers Primary sits next to the country's largest paper mill (Mondi) and between two refineries: one run by Engen, Chevron and Total; and the other, called Sapref, by BP, Shell and Thebe Investments. Sapref's worst leak so far was 1.5 million liters into the Bluff Nature Reserve and adjoining residences in 2001.

Together these refineries can process 300,000 barrels of oil a day, more than any other single site in Africa aside from an Algerian mega-refinery. A new 705km pipeline from the Durban refineries to Johannesburg will double the existing pumping capacity, an invitation for much more damage here. Delayed two years, the government pipeline project's cost overrun went from $1.4 billion announced in 2005 to $3.4 bn today. Our petrochemical armpit gets smellier, as soaring financial costs add to the social and environmental calamaties.

Amazonian oil soils our forest lungs

Because of flying so much, I am feeling an acute need to identify and contest the full petroleum commodity chain up to the point it not only poisons my South Durban neighbours but generates catastrophic climate change. And regrettably, this search must include Venezuela, Bolivia and Ecuador (and from last week Peru as well), for even South America's most progressive governments are currently extracting and exporting as much oil and gas as they possibly can. We may even be recipients in South Africa, if government's plans to build a massive $15 billion heavy oil refinery near Port Elizabeth come to fruition. A $300 million downpayment was announced in the last budget, and full capacity will be 400,000 barrels per day.

From where would this dirty crude come? Two weeks before he was booted from office in September 2008, disgraced SA president Thabo Mbeki signed a heavy oil deal with Hugo Chavez. It appeared a last-gasp effort by Mbeki to restore a shred of credibility with the core group to his left – the Congress of SA Trade Unions and SA Communist Party – who successfully conspired to replace him with their own candidate, Jacob Zuma, as ruling party leader nine months earlier. In those last moments of power, Mbeki fancifully claimed he wanted to pursue Bolivarian-type trade deals, and Chavez told Mbeki, "It is justice ... it will be a wonderful day when the first Venezuelan tanker stops by to leave oil for South Africa." The harsh reality is that the preferred refinery site, Port Elizabeth's Coega, will probably retain its nickname, the "Ghost on the Coast", and Durban will continue to suffer the bulk of oil imports, as BP now actively campaigns against a new state refinery.

Venezuelan dirty crude is akin to Canadian tar sands, and hopefully sense will prevail in Caracas. There is a fierce battle, however, for hearts and minds in both Bolivia – where movements fighting 'extractivism' have held demonstrations against the first indigenous president, Evo Morales, even at the same time his former UN ambassador Pablo Solon bravely led the world climate justice fight within the hopeless arena of UN Framework Convention on Climate Change negotiations – and Ecuador where Rafael Correa regularly speaks of replacing capitalism with socialism. Both have rising 'buen vivir' (good living) decolonial movements and even 'rights of Mother Earth' in their constitutions – so far untested.

In Quito and Neuva Rocafuerte deep in the Amazon last week, I witnessed the most advanced eco-social battle for a nation's hearts-and-minds underway anywhere, with the extraordinary NGO Accion Ecologica insisting that Correa's grudging government leaves the oil in Yasuni National Park's soil. Because he was trained in neoclassical economics and hasn't quite recovered, Correa favours selling Yasuni forests on the carbon markets, which progressive ecologists reject in principle.

Accion Ecologica assembled forty members of the civil society network Oilwatch – including four others from Africa led by Friends of the Earth International chairperson Nnimmo Bassey from the Niger Delta – first to witness the mess left by Chevron after a quarter century's operations. Six months ago, local courts found the firm responsible for $8.6 billion in damages: cultural destruction including extinction of two indigenous nations, and water and soil pollution and deforestation in the earth's greatest lung – but Chevron's California headquarters refuses to cough up.

The really hopeful part of the visit, however, was Accion Ecologica's proposal at Yasuni, on the Peruvian border, that $7-10 billion worth of oil in the block known as ITT not be drilled. Part of the North's debt for overuse of the planet's CO2 carrying capacity must be to compensate Ecuador's people the $3.5 billion that they would otherwise earn from extracting the oil. Leaving it unexploited in the Amazon is the most reasonable way that industrial and post-industrial countries can make a downpayment on their climate debt.

If the UN's Green Climate Fund design team, co-chaired by South African planning minister Trevor Manuel, were serious about spending its promised $100 billion a year by 2020, this project is where they would start, with an announcement on November 28 to put the Durban COP17 climate summit on the right footing.

Don't count on it. Instead, as usual, civil society must push this argument, in the process insisting on leaving oil in the soil everywhere so that other tankers share what we pray will be the final fate of the wretched ship MT Phoenix: a graceful not rocky retirement.

Patrick Bond is with the UKZN Centre for Civil Society in Durban: http://ccs.ukzn.ac.za.


http://www.counterpunch.org/bond08022011.html

This is good!

SA and Lesotho to build 1 200 MW hydropower plant
COMMENT PRINT EMAIL |

By: Brindaveni Naidoo
11th August 2011

Updated 27 minutes agoTEXT SIZE South Africa and Lesotho on Thursday signed an implementation agreement for the second phase of the R15-billion Lesotho Highlands Water Project (LHWP) and committed to building a hydropower station with an installed capacity of between 1 000 MW and 1 200 MW.

The hydropower plant would be operational in 2018, and would see some 200 MW supplied for Lesotho’s power needs, with the remaining power transmitted to South Africa.

South African Water and Environment Affairs Minister Edna Molewa told Engineering News Online that Cabinet had approved the project and that the two countries would now sign a memorandum of understanding (MoU) under the auspices of South Africa’s Department of Energy.

The Lesotho government also approved the project, and draft agreements were ready, Lesotho Natural Resources Minister Monyane Moleleki said in an interview in Maseru.

“The MoU to be signed between the two countries will not only focus on hydropower, but will see both countries look at projects on renewable energy, including solar and wind,” he said.

Both Ministers remained confident that the skills needed for the second phase of the project were available.

“There is sufficient capacity between both countries, and where or if necessary we will deploy required skills. But it is key to remember that we have Eskom coming on board on this project,” Molewa explained.

The LHWP would strengthen regional integration by using water as a catalyst for socioeconomic development, as well as to advance economic links with key African partners.

“The nature of our cooperation is aimed at mutual development of our countries’ water sectors as a foundation and a catalyst for modernised and integrated economies. It embodies the Nepad principles for development and Africa’s renaissance to eradicate poverty and underdevelopment.”

Phase two of the LHWP also comprises a water delivery system to augment the delivery of water to South Africa.

The system comprises the Polihali reservoir on the Senqu river, and a water conveyance tunnel connecting Polihali reservoir with the Katse reservoir. It would also see the development of key infrastructure including access roads to the project sites and camps, as well as power transmission lines and administrations centers, including social and environmental projects and programmes.

This phase would also include a pump storage scheme and associated transmission lines.

^^Sweet, imagine if Lesotho was part of SA, we could drill the whole of the Malutis and install hydropower on a vast scale there. They could be a key supplier of water and energy to the industrial heartland. These piecemeal projects are infuriating...

Swiss firm to build solar plants in SA
By SA Commercial Prop News 21/09/2011

ABB, the power and automation technology group, will construct two solar photovoltaic power plants for Eskom, SA's national electricity provider.
The pilot plants, each of one hectare, would be located on greenfield sites adjacent to the coal-fired power stations at Lethabo, in the Free State province, and Kendal in the Mpumalanga province, ABB said in a statement on Monday

They will be the first of their kind built in the country.

At the Kendal power station, ABB will provide a fixed tilt solar PV power plant with a station capacity of 620 kilowatts (kW) and production potential of 11,445,398 kilowatt hours (kWh) per year. At the Lethabo site, the installation will comprise a single-axis tracking solar PV power plant with a peaking capacity of 575 kW and a production potential of 12,491,479 kWh per year.

"ABB is really proud to provide their world-class technology for these pilot solar PV projects," said Carlos Pone, Country Manager, ABB in SA.

"They are the first of their kind in PV technology in the country and we are elated to be associated with them," he said.

The PV plants will be designed to operate independently to produce electrical power for use by the existing power stations and will be capable of remote operation and monitoring. The fast track projects are scheduled to be completed by November 2011 prior to the COP (Conference of Parties) 17 event on climate change to be held in Durban later that month.
"These orders will afford ABB in SA with the opportunity for transfer of skills in solar technology, which will complement and further enhance the local capabilities in engineering and project management," added Pone.

Source: SA Commercial Property News (http://www.sacommercialpropnews.co.za/business-specialties/environmental-green-issues/3552-swiss-firm-to-build-solar-plants-in-sa.html)

Don't know if this post goes in this thread, but this news is being published worldwide, even though this system was implanted in 2007

Fog harvesting gives water to South African village
SIBONGILE KHUMALO TSHIAVHA, SOUTH AFRICA - Nov 01 2011 12:24

When plumes of fog gather above the rocky mountains encircling a remote South African village, children look at them with excitement, knowing they will have clean drinking water at school.

Like many rural areas in the country, running water in Tshiavha village in Limpopo province is scarce, but the school-based fog harvesting nets have brought some relief.

Mountainous landscapes and a misty climate make Tshiavha village one of the few areas in dry South Africa where fog can be captured, with a system used in the Andes and the Himalayas that remains a novelty here.

But with experts predicting that Southern Africa will become drier and hotter over the next four decades, such schemes are getting a new look as South Africa prepares to host the next round of United Nations climate talks in November.

Erected in 2007 with the help of a local university, the fog trapped in the nets provides up to 2 500 litres of waters on a good day.

"The water is clean and safe with no chemicals added to it," said Lutanyani Malumedzha the principal of Tshiavha Primary School.

'Not a single drop is wasted'
According to Malumedzha, access to clean water had significantly improved school children's health and reduced the outbreak of waterborne diseases.

"Children used to bring their own bottles of water to school during the hot and dry months. The water was collected from muddy wells and not suitable for human consumption," said Malumedzha.

In some areas, communities share drinking water with cattle.

Although South Africa's water quality is rated among the best in world, rural communities lag behind when it comes to having running water.

"We have learnt to appreciate water and treat it as if it was a precious commodity," said Malumedza.

"Not a single drop is wasted. Some of it goes there," said Malumedza pointing to a vegetable garden which provides food for the school feeding scheme.

The 4m high mesh net which stands outside the school's playground resembles a volleyball net, except for a gutter at the hem where water droplets fall, leading to a water tank a few metres away.

'Cost-effective alternative'
There are no electronics involved and the system requires little maintenance, Malumedza said.

As a relatively dry country, water is scarce in South Africa and remote areas with no infrastructure are hardest hit by the changing weather patterns.

"This is a cost-effective alternative which can be successfully explored given the water challenges in the country," said Liesl Dyson, a researcher from the University of Pretoria.

Limpopo province in the north, which borders Botswana, Zimbabwe and Mozambique and is home to the renowned Kruger National Park, is one of the hottest regions in the country.

But the area is one of the few places in the country with a climate suitable for fog harvesting.

"Fog only is not enough, it also needs a bit of wind to blow it," said Dyson.

"It doesn't help much if the fog just settles on the mountains without moving," said Dyson.

She said the system was used in a few areas in the west coast and the Transkei in the Eastern Cape province.

According to the Council for Scientific and Industrial Research, South Africa has annual rainfall of 490mm, half the world average.

Even without the effects of climate change, South Africa is expected to face water shortages by 2025, and plans to build a new dam in Lesotho to pipe more into the country. -- AFP

http://mg.co.za

SOUTH AFRICA, DR CONGO TO SIGN MAJOR HYDRO-ELECTRIC POWER AGREEMENT
PRETORIA, Nov 11 (NNN-BUANEWS) -- South Africa and the Democratic Republic of Congo (DRC) are to sign a major hydro-electric power project at the weekend which officials say will benefit both countries.

President Jacob Zuma, who will visit the DRC on Saturday, is expected to witness the signing of the deal with his counterpart President Joseph Kabila, the Presidency said in a statement here Thursday. Read more (http://namnewsnetwork.org/v2/read.php?id=175918)

This is good!

SA and Lesotho to build 1 200 MW hydropower plant
COMMENT PRINT EMAIL |

By: Brindaveni Naidoo
11th August 2011

Updated 27 minutes agoTEXT SIZE South Africa and Lesotho on Thursday signed an implementation agreement for the second phase of the R15-billion Lesotho Highlands Water Project (LHWP) and committed to building a hydropower station with an installed capacity of between 1 000 MW and 1 200 MW.

The hydropower plant would be operational in 2018, and would see some 200 MW supplied for Lesotho’s power needs, with the remaining power transmitted to South Africa.

South African Water and Environment Affairs Minister Edna Molewa told Engineering News Online that Cabinet had approved the project and that the two countries would now sign a memorandum of understanding (MoU) under the auspices of South Africa’s Department of Energy.

The Lesotho government also approved the project, and draft agreements were ready, Lesotho Natural Resources Minister Monyane Moleleki said in an interview in Maseru.

“The MoU to be signed between the two countries will not only focus on hydropower, but will see both countries look at projects on renewable energy, including solar and wind,” he said.

Both Ministers remained confident that the skills needed for the second phase of the project were available.

“There is sufficient capacity between both countries, and where or if necessary we will deploy required skills. But it is key to remember that we have Eskom coming on board on this project,” Molewa explained.

The LHWP would strengthen regional integration by using water as a catalyst for socioeconomic development, as well as to advance economic links with key African partners.

“The nature of our cooperation is aimed at mutual development of our countries’ water sectors as a foundation and a catalyst for modernised and integrated economies. It embodies the Nepad principles for development and Africa’s renaissance to eradicate poverty and underdevelopment.”

Phase two of the LHWP also comprises a water delivery system to augment the delivery of water to South Africa.

The system comprises the Polihali reservoir on the Senqu river, and a water conveyance tunnel connecting Polihali reservoir with the Katse reservoir. It would also see the development of key infrastructure including access roads to the project sites and camps, as well as power transmission lines and administrations centers, including social and environmental projects and programmes.

This phase would also include a pump storage scheme and associated transmission lines.

Diggerdog, you have a link to this info on the web?

SA evaluating 53 mostly wind, solar bids worth R7bn, next bid window set for March

By: Terence Creamer

14th November 2011

A total of 53 bids, representing some 2 100 MW of potential capacity, were received by the Department of Energy (DoE) during the first bidding 'window' that closed on November 4 - the tender is for the procurement of 3 725 MW of renewable energy from independent power producers (IPPs) by 2016.

Director-general Nelisiwe Magubane said government was pleased with the response and indicated that the process had been designed with the possibility of having as many as five bid windows, with the next round currently due to close on March 5, 2012.

However, she also indicated that discussions were under way with the Department of Environmental Affairs, which was having some difficulty in processing all the environmental authorisations required for the next round. Therefore, the date might be adjusted to ease that constraint, as the absence of environmental approvals was seen as an immediate “deal breaker”.

Updating the media on the process, deputy director-general Ompi Aphane said that half of the offers related to wind projects, while 48% were for solar developments, both photovoltaic and concentrating. The balance of the bids related to small hydropower plants, and it was anticipated that the other technologies (such as biogas, biomass and landfill gas) might feature more strongly when the so-called small-projects tender was released later this year. This tender would have lower thresholds, but would only cater for projects that had capacities of less than 5 MW.

Should all the capacity currently on offer be developed, it would involve combined investments of around R7-billion, with more than half of the capital likely to flow from foreign direct investors. However, the evaluation process was still at the early stages, with the economic development aspects currently under consideration. Only once these criteria had been met would the bid price, which carried a 70% adjudication weighting, be considered. The 30% balance covered such aspects as job creation, local content, management control, preferential procurement, socioeconomic development and ownership – at least 40% of a project would need to be owned by South Africans to be considered as compliant.

The projects on offer were sited across all nine provinces, besides Mpumalanga, with most of the interest arising for developments in the Northern Cape, Eastern Cape and Western Cape provinces.

Aphane said the evaluation process was under way in a “secure” location and was being conducted by technical specialists with no direct association to the DoE and its officials. Once this evaluation was completed, it would be handed over to the department for adjudication.

The adjudication process itself would be subjected to an internal audit, as well as a review, which would be conducted by an independent, global auditing firm.

Preferred bidders should be identified by the end of November, or before the end of the upcoming global climate conference, which would take place in Durban from November 28 to December 9.

A six-month period would be allowed for developers to reach financial closure, which would include the signing of a power purchase agreement with Eskom. Aphane, thus, believed that the first capacity could start producing during 2012, with most of the capacity from the first bid window being introduced by the end of 2013.


Edited by: Creamer Media Reporter



http://www.engineeringnews.co.za/art...rch-2011-11-14

R30bn needed to maintain electricity infrastructure - EWN

Close to R30 billion will be needed for the maintenance of electricity distribution infrastructure nationwide.

The Energy Department presented an alarming picture to Parliament’s Energy Portfolio Committee on Tuesday.

The committee heard from a number of stakeholders on the challenges in the electricity distribution sector and discussed a way forward.

Chief Director of electricity in the energy department Thabang Audat said 2008 figures showed that R27.4 billion was needed for maintenance and that was escalating at R2.5 billion per annum.

187 municipalities are responsible for those costs.

He said networks needed to be improved to service delivery.

With 75 percent of the country being electrified, the poor are battling to pay rising tariffs.

There were huge revenue losses because of electricity theft and municipalities were urged to act on tip offs.


^^^^^^
Maybe they should take cuts in thier salaries to help fund the maintenance!!!

Any news on natural gas exploration in SA? Many public power utilities in Texas are building/planning new power plants that will run on natural gas. Its local, its cheap, and much cleaner than coal.

http://www.engineeringnews.co.za/article/increased-use-of-lpg-could-save-sa-billions-kaya-gas-2012-03-15

Increased use of LPG could save SA ‘billions’ – Kaya Gas

If 1.2-million households in South Africa converted to liquefied petroleum gas (LPG) it would save the country some 55 000 MW of electricity every five years, Kaya Gas MD George Tatham said this week....

Anglo eyes SA power plant project
20 minutes ago Reuters

Johannesburg - Anglo American [JSE:AGL] plans to build a 450 MW power plant in South Africa to supply electricity to its platinum subsidiary Anglo Platinum [JSE:AMS], Business Day newspaper reported on Wednesday.

The paper quoted the head of the company’s coal division in South Africa Norman Mbazima as saying the plant would cost more than $1bn, and that seven parties had bid to build the plant near Witbank in eastern Mpumalanga.

The plant, which is expected to start producing electricity in 2015, would reduce Amplats' reliance of power supply from state-owned Eskom and cushion it from large price increases.

A spokesperson for Anglo Thermal Coal could not immediately be reached for comment.

South Africa has been struggling to meet demand for power as construction of new plants meant to plug the shortfall have been delayed. Supply will remain vulnerable until the first units of Eskom's new stations become operational next year.

Source: Fin24 (http://www.fin24.com/Companies/Mining/Anglo-eyes-SA-power-plant-project-20120411)

Darling wind farm gets green light, but farmers are divided
THURSDAY APR 19, 2012

The hills of Darling are set to get a wind farm with 43 turbines between 80m to 100m high.

Called the Rheboksfontein Wind Energy Facility, the wind farm has been given the green light by the Department of Environment.

Most of the turbines will be erected on the farm Rheboksfontein, home to the vines that produce Ormonde wines.

But the approval of the 129MW wind farm appears to have split the community, with some farmers welcoming the project and others saying they will have nothing to do with it.

In one case the difference of opinion is between two brothers on neighbouring farms, one of whom will have nothing to do with the project and the other welcoming the wind farm as a means to earn rent and earn carbon credits.

Theo Basson, owner of the Rheboksfontein farm who is in favour of the project, said yesterday the bulk of the wind turbines would be built on his farm. "When I negotiated with the company that wanted to put it up, I said they had to exclude my highpotential vineyard soils. I've spent a lot of time in Europe marketing my wines and there are lots and lots of wind turbines there, and no one minds.

"The only drawback from wind power is that you can see the towers. Seems to me people don't care about the fact that it is clean energy."

He would get direct benefits from the wind farm as the developer, Moyeng Energy, partly owned by Investec, would pay him rent for the turbines on his land. "I hope to use them as carbon credits in wine production and get zero carbon status for my wine."

His brother, Nikolaas, on neighbouring Alexanderfontein wine farm, is apparently opposed to the project, and would not agree to have the transmission lines over his land. However, he would say only: "Alexanderfontein is my land and I'm not involved in the project at all."

Another farmer, Bodo Gents on the farm Doornfontein, who owns the Weskus Padstal, said he would not allow the transmission lines on his land. "The Darling hills have a historic valley. These turbines will be on my border. We want to put up a game farm here but that is on hold now because of this. It's one thing to put up a wind farm in the middle of the Karoo, but quite another to place it on a major scenic route," Gents said.

Peter Pentz, owner of the historic Groote Post farm, said: "Wind energy is a wonderful thing. I don't see the problem. I see wind farms all over Europe and it's quite magical. Please let it come and save the planet."

Tommie Potgieter, of Moyeng Energy, said the project still had to get several other approvals from other authorities before it could be built.

Asked what he would do if farmers would not give permission for the transmission lines, Potgieter said the question should be directed to Eskom. Eskom had not replied at the time of going to press.

Cape Times
Source: IOL Property (http://www.iolproperty.co.za/roller/news/entry/darling_wind_farm_gets_green)

awesomeness!!! - those turbines should be out on Dassen Island too - fok the penguins!

SA energy programme attracting foreign investors

SA's first foray into renewable energy has every chance of success with billions of rands from foreign investment expected to flow into the country, says professional services firm PricewaterhouseCooper's.

'Investment in renewable energy encouraging'

The procurement programme launched by the Department of Energy (DoE) in August 2011 with an initial allocation of 3,725 MW across multiple technologies, has attracted developers, investors and engineering, procurement and construction contractors from across the globe including the US, Germany, Italy, Spain, France, China and India.

According to the advisory, while slower growth in some of these markets has forced developers to look beyond their own borders, the size and scale of the SA's procurement programme has made the market appealing to most developers.

The aim of the government's procurement programme from independent power producers is to stimulate renewable energy and environmentally sustainable economic development and job growth in SA as per its national integrated resource plan.

In December last year, the 28 preferred bidders in the procurement programme were announced.

Kasief Isaacs, PricewaterhouseCooper's (PwC) partner in the energy division, said the next milestone after the announcement of the round 2 preferred bidders expected early next week is assessing how many of the round 1 preferred bidders achieved financial close.

"While the preferred bidders and their partners are naturally reticent regarding progress, the law of averages dictate that some of these projects may not be able to meet the late June deadline to achieve financial close," Isaacs said.

Isaacs however added that, for the first round bidders who were on track to achieve their financial close timetable, the future looked promising, in that their first projects could be connected to the grid by June 2014.

"The Department of Energy seems to have the balance right so far in making initial allocation large enough to kick start the industry and attract some of the leading renewable energy companies in the world, while at the same time encouraging price competition between developers and deploying renewable energy in a phased manner," Isaacs said.

According to Isaacs, the department had also learned from other markets, and looked likely to avoid the challenges experienced elsewhere of too rapid expansion of renewable energy capacity at unsustainable tariffs and ultimately unsustainable cost to governments and consumers.

Renewable energy is an integral part of SA's energy mix for the foreseeable future based on the 20 year integrated resource plan for electricity promulgated in May 2011.

Based on the integrated resource plan for electricity, developers expect that an allocation of new capacity for renewable energy will be made available annually following the initial procurement programme although this has not been officially confirmed by the Department of Energy.

"The competitive bidding process will keep downward pressure on the tariffs proposed by developers while the qualitative criteria contained in the procurement programme maximises the chances of proposed developments ultimately being developed," Isaacs said.

He added that developers already active in the market were keen to expand their portfolio of projects for the next procurement window.

"While the majority of projects to date has been funded by South African lenders, developers have slightly more time to prepare for round 3, and are now evaluating the use of foreign debt and export credit agreements to off-set the higher cost of interest available in the South African market."

Compared to May last year when many developers and industry associations expressed disappointment by the lack of certainty and progress in the renewable energy programme, the industry, although still in its infancy, has its eyes firmly fixed on the future and the potential for developing renewable energy projects in the country.

http://www.businesslive.co.za/southafrica/sa_markets/2012/05/17/sa-energy-programme-attracting-foreign-investors

50 MW SA solar project part of Saudi group’s diversification drive
PRINT EMAIL |

By: Terence Creamer
5th June 2012

Saudi Arabian power and water group ACWA Power International has confirmed that the 50 MW Bokpoort concentrated solar power (CSP) project, which is proposed for the Northern Cape, will be its first investment in Africa.

The development, which has an estimated project cost of R4.5-billion, was selected along with 18 other preferred bids during the second-window evaluation under government’s Renewable Energy Independent Power Producer Programme (REIPPP), which took place between March 5 and May 21.

ACWA Power has a portfolio comprising 12 000 MW of power generation capacity, as well as desalination plants able to process 2.3-million cubic metres a day. Its portfolio currently spans Saudi Arabia, Oman and Jordan, while it has a project under development in Turkey.

ACWA CE Paddy Padmanathan describes the Bokpoort project as a milestone for the group’s geographical and technological diversification. He says the project will also be key to the group’s aspiration of expanding its total capacity to 30 000 MW by the end of 2014 and having renewables making up five per cent of it power portfolio.

The Bokpoort consortium also comprises black economic–empowerment (BEE) firm Invest in Africa Energy (IAE), which has a 30% shareholding, the Industrial Development Corporation (IDC), Lereko Solafrica Investment, Lereko Metier Solafrica Fund 1, Lereko Metier Sustainable Capital Fund, Kurisani Solafrica Investments and Solafrica Community Investment Company. The community shareholding will reportedly represent 10% of the project.

In addition, Investec, the Development Bank of Southern Africa and the IDC will provide the debt funding requirements of the project.

ACWA’s subsidiary NOMAC will operate the plant, which will be constructed by an engineering, procurement and construction consortium comprising TSK Electrónica y Electricidad, Acciona Infraestructuras, Acciona Ingeniería, Sener Ingeniería y Sistemas, all of Spain, as well as Crowie Concessions, of South Africa.

The Department of Energy expects the facility to incorporate 36,5% local content, create 662 construction jobs and 50 operational posts. It also expects the plant to deliver power at a cost of R2.51/kWh.

IDC SUPPORT

The greenfield development is one of several REIPPP projects being supported by the State-owned IDC, and it was the only CSP project to advance to the preferred-bidder stage during the second bid window.

During window one, two projects (the 100 MW KaXu Solar One and the 50 MW Khi Solar One, which are being developed by Abengoa and the IDC) advanced. The three projects have also absorbed the full 200 MW allocated to CSP under REIPPP.

Over the first two rounds the IDC supported a total of 36 bidders, of which 19 were named as preferred bidders – the window-one projects are due to reach financial closure by June 19, while those announced on May 21 have until December to reach closure.

The South African development finance institution has set aside R25-billion for various green projects over the coming five years, including the REIPPP projects that are meant to add 3 725 MW of renewable energy capacity to the South African grid by 2016.

The targeted financial close date for Bokpoort is the end of 2012, with the developers having set a commercial operation date for the third quarter of 2015.

The project will reportedly be equipped with the largest thermal storage capacity adopted for a CSP plant of its size, which should enable it to produce 200 GWh/y.

Padmanathan says ACWA has also sought to maximise BEE participation and that IAE will not only contribute local knowledge but also provide a platform for its skills-transfer plans.

IAE chairperson Enver Asmal says the project confirms and extends its longstanding collaboration with ACWA Power in the development of power projects in Southern Africa and will enable it to gain valuable power sector experience.

http://www.engineeringnews.co.za/article/50-mw-sa-solar-project-part-of-saudi-groups-diversification-drive-2012-06-05

Infrastructure 100

Presenting the Infrastructure 100 - report on the most exciting infrastructure projects from around the world, as selected by independent judging panels due to their scale, complexity, innovation and impact on society.

KPMG’s Global Infrastructure practice, in conjunction with Infrastructure Journal, is pleased to present the Infrastructure 100 – a showcase of the most interesting infrastructure projects from around the world.

Of those 100 projects – all shortlisted for their scale, complexity, innovation and impact on society – 10 have been highlighted by the independent judging panels as notable projects in different infrastructure sectors.

They are:
Water – The Venice MOSE Flood Barrier, Italy;
Power – Green Power Express, USA;
Oil & Gas – Project Mthombo oil refinery, South Africa;
Renewable energy – Incheon Tidal Power Project, South Korea;
Rail – TAV high speed rail link, Brazil;
Roads – Hong Kong-Zhuhai-Macau bridge;
Other transport – Panama Canal extension, Panama;
Healthcare – CRCHUM P3 research centre, Canada;
Education – King Abdullah University of Science & Technology, Saudi Arabia;
Other Social Infrastructure – Greater Manchester Waste, UK.

blah, blah blah...and then...

Social, as well as economic, impact was never far from the judges’ minds – as with the Project Mthombo refinery which represents the centre piece of a new economic zone in the Eastern Cape Province.

http://www.kpmg.com/Global/en/IssuesAndInsights/ArticlesPublications/Pages/Infrastructure-100.aspx

Electricity distribution network collapse three years away

South Africans should expect more power cuts, as the distribution grid will gradually collapse from 2015 unless a maintenance backlog is addressed, an expert said on Thursday.

"We are three years away from collapse," Deon Louw, the deputy director of electro-technical services in Overstrand municipality, Western Cape, told MPs.

"It is going to collapse in stages, as some parts are older than others. We will see power failures."

Louw told public hearings on the electricity distribution industry --hosted by Parliament's portfolio committee on energy -- that the lifespan of a distribution network was 50 years, and said the various components of South Africa's had an average age of 47 years. (http://www.engineeringnews.co.za/article/network-collapse-three-years-away-2012-07-26)

SA and US sign energy deal

The Export-Import Bank of the United States and South Africa have signed a $2 billion Declaration of Intent (DoI) to help advance the country's green energy schemes.

http://www.linksouthafrica.com/Modules/CMS/Templates/InfoArticle.aspx?url=Business%2Fsa-and-us-sign-energy-deal&contentpageid=f3a7c6a7-a2ab-4668-8f5c-4b98bd8f73ef&templateid=83292af2-c3b6-47bd-bb57-bc7217d5d7af

That is actually awesome news...

http://themavesite.com/TMS-Pictures/Epic/Memes/NotBadObama.png

Fracking possible as
moratorium on shale gas
exploration lifted

"According to an initial study commissioned by
the U.S. energy information administration,
South Africa has 485 trillion cubic feet of
technically recoverable shale gas resources,
most of which are located in the vast Karoo
Basin."

http://www.timeslive.co.za/scitech/2012/09/07/fracking-possible-as-moratorium-on-shale-gas-exploration-lifted

Tree huggers must just sit down nxa!

No, the tree huggers won't just sit down.

Neither will us right minded people. I am NOT impressed that this is being even thought of tbh.

Awesome news! SA needs this.

just wait, the govmnt will release some strategy in the wake of Marakana to say they will make a state company to extract it under the guise of SA's new energy/mining future ( as our production of gold dries up), thus immesurably fucking up the karoo. they will say the endeavour will herald a new start, a new "contract " with workers through share schemes etc and make lip service to a more socialist miner friendly system for the workers. They will then fuck the whole thing up, AND they will destroy the ecosystem too,but ultimately they will publicly challenge any naysayers to think of how else to re-employ 500000 workers when mines are shut down all over the place.

RENEWABLE ENERGY PROGRAMME TO BRING R47BN IN INVESTMENT
Written by eProp@News

The Department of Energy says it is expecting R47 billion to be invested in the country through Window 1 of the Renewable Energy Independent Power Producer Programme (REIPPP).

The department introduced the REIPPP in August 2011, with the first bid submission for Window 1 scheduled for 4 November 2011.

The outline for the first 28 preferred bidders -- who were announced on 7 December during COP17 -- is now in place and the department says it is ready to sign contracts with the bidders, which will unlock the massive investment.

Window 1, which sought 1 400 megawatts of renewable energy, gave bidders (in wind and solar projects) until June this year to reach financial close, but due to issues - including approvals by government institutions - the date had been postponed.

President Jacob Zuma announced in his State of the Nation Address a massive infrastructure plan comprising various development projects. One of the Strategic Integrated Projects includes green energy in support of the South African economy.

Briefing reporters on Monday, Energy Minister Dipuo Peters said the department had been working closely with the preferred bidders in Window 1 to conclude all contract documentation, including the Power Purchase Agreement and Implementation Agreement.

"The delay for financial close was largely related to government approvals. We apologise for shifting the timeframes," said the minister.

The delays in government approvals were caused by the need to have fully populated contracts to be presented to the relevant structures within government for approval.

"I'm pleased to announce that the country will receive about R47 billion of investment in renewable power generation through Window 1 preferred bidders," said Peters.

The investment will provide job opportunities, especially for those in rural where renewable power plants are located.

According to the Integrated Resource Plan (IRP2010) - which is a 20-year projection on electricity supply and demand - about 42% of electricity generated in South Africa is required to come from renewable resources.

The IRP2010 places specific emphasis on broadening electricity supply technologies to include gas, imports, nuclear, biomass, renewables (wind, solar and hydro), in response to both the country's future electricity needs as well as reduce its CO2 emissions.

Originally, 53 bids amounting to 2 128 MW were received across wind, solar PV, solar CSP and small hydro. The evaluation resulted in 28 bids, with a total MW of 1 416 being selected as preferred bidders in the first window.

The wind and solar PV projects are expected to be integrated into the country's national energy grid during 2014.

"The signing of agreements for Window 1 preferred bidders will take place on 5 November 2012," Peters said, adding that bidders were expected to honour the commitments made in their bids.

Should bidders fail to comply with the commitments, penalties such as the termination of the power purchase agreement, will be implemented.

Peters said she had received concurrence from the National Energy Regulator of SA (Nersa) for additional allocations to the renewable programme, base load generation and the Medium Term Risk Mitigation Plan generation.

Earlier this month, Peters said she was considering a second determination that would provide additional megawatts in the renewable energy space.

"I will be promulgating these determinations before the end of the year," said Peters. -

Source: eProp (http://www.eprop.co.za/news/item/14457-renewable-energy-programme-to-bring-r47bn-in-investment.html)

cant wait - lets get this going man!! - for our own collectve good ( SA is like, in the top 20 worst polluters - eish! ) Lets also aim to build capacity and manufacture-to-export the machinery to other african countries!
Biomass in particular!

New Pump Storage Sceme quietly being build in the Little Drakensberg - Good pics here via Eskom's page ( About the only thing good about Escom lol )

http://www.eskom.co.za/c/article/54/ingula-pumped-storage-scheme/

The Pumped Storage Scheme consists of an upper and a lower dam; both of approximately 22 million cubic metres water capacity. The dams, 4.6 km apart, are connected by underground waterways, through an underground powerhouse which house, 4 x 333MW pump turbines. During times of peak energy consumption, water will be released from the upper dam through the pump turbines to the lower dam to generate electricity. During times of low energy demand the pump turbines are used to pump the water from the lower dam back up to the upper dam.

The project is scheduled to come on line during 2013/14.

Nice. This is not part of the Lesotho highlands project, which is also kicking off its second phase at the moment...

http://www.iol.co.za/polopoly_fs/busrep-logo2-1.688666!/image/1010549842.jpg_gen/derivatives/absolute/1010549842.jpg

Eskom’s madness damages SA jobs

November 2 2012 at 08:00am
By Donwald Pressly.

If the National Energy Regulator of SA doesn’t stop Eskom in its madness, it would simply “kill the goose that lays the golden egg”, as the Department of Trade and Industry (dti) described it this week.

A 16 percent rise each year for a five-year period – with another 10-year period of above-inflation hikes promised after that – will destroy any prospects of economic growth. It will destroy jobs in their thousands. It will close down factories by the score and, possibly, achieve in record time the economic devastation President Robert Mugabe has failed to unleash next door through reckless policy stances.

Just a glance at a graph produced during hearings on the medium-term expenditure framework at the National Assembly trade and industry committee this week tells the story of the damage the increases have caused since 2008. Jobs in the manufacturing sector dropped from 1.3 million to 1.15 million between 2008 and this year.

The impact of 25 percent and above increases since then have been devastating. Of course, these hikes have been carried out even as top officers get stellar bonuses that make the yearly salaries of most taxpayers look like pittances.

Next week a number of foundries will put forward arguments why it doesn’t make business sense to carry on trading if the price of electricity continues to rocket.

From the government’s side, the repeated argument is the required build programme was not carried out when it was cheaper to do so. Committee chairwoman Joan Fubbs went so far as to blame the apartheid government for not building new infrastructure in the 1970s and 1980s. She, of course, as an ANC MP, can’t be seen to be criticising the leadership of the ANC in the 1990s and 2000s for doing even less.

The problem of mounting electricity costs has a lot to do with the lack of ingenuity of a state-owned corporation. Eskom has a monopoly on power generation, transmission and much of the distribution. The model is wrong.

While the Economic Development Department has been waging a war on private sector monopolies – probably correctly – it stays quiet about state monopolies. They tend not to work because they are built on a foundation of administrative inertia.

During the debate on the causes of the power supply problems and high costs of production, ANC MPs tended to focus on the mark-ups by municipalities on the Eskom base price. They are astonishingly high. Johannesburg and Tshwane happen to be among the highest at about 700 percent. Cape Town, which is opposition ruled, is more than 300 percent.

Nelson Mandela Bay will be up by about 540 percent. This revenue cross-subsidises other services, including water and waste, in this way. If that revenue tap was switched off, the already troubled third tier of government would be strangled. Ironically, the mark-ups at ANC ruled municipalities tended to be the highest.

What a fine mess our state power monopoly has got the country into. The Manufacturing Circle said more reasonable progressive hikes could be one solution. Subsidies to industry could also be considered. That will mean, however, that a whole new ream of red tape will arise. The circle points to Brazil, which is cutting the cost of electricity next year.

Eskom’s massive grip on the sector needs to be relaxed. Ways of involving the private sector in power generation that are economically feasible have to be found. Somewhere, someone has to be found who can think out of the electricity box and lead the country to a solution. Throwing even more money at Eskom isn’t an option.

12 November 2012 - The European Investment Bank, Europe’s long-term lending institution, has agreed to provide US$63.5 million for the Khi Solar One project. This is the first large concentrated solar power project in sub-Saharan Africa and one of the first private sector renewable energy projects in South Africa.

European Investment Bank support was formally agreed at the financial close of the project during the official closing ceremony for REBID 1 projects.The Khi Solar One project consists of a 200m high tower and more than 4,500 heliostat moving mirrors to reflect light onto the tower. It is located on a 600 hectare site close to Upington, in South Africa’s Northern Cape province. Jointly owned by Abengoa, the Industrial Development Corporation (IDC) and with Black Economic Empowerment (BEE) involvement, the 50 MW project will be Abengoa´s third commercial solar tower and it’s first outside of Spain.

The South African plant will have more than double the capacity of the last tower Abengoa built in Andalucia. Khi Solar One will use concentrated solar technology that harnesses solar radiation by focusing it onto a small area to produce steam, which drives a turbine and produces electricity. Advanced dry cooling technology will reduce water consumption by two thirds.

The Khi Solar One plant will sell its electricity to South Africa’s state owned electricity utility, Eskom, for 20 years, agreed under a power purchase agreement (PPA). An average of 600 construction jobs will be created during the construction period and there will be about 35 fulltime plant operations employees. The plant will be able to store thermal energy for two hours and will prevent about 183,000 tonnes of CO2 emissions a year.

The Khi Solar One scheme was financed using a project finance framework and is expected to attract developments, investors and lenders to support other renewable energy schemes and secure broader support for financing innovative renewable projects in South Africa. IFC, FMO, Proparco, IDC and the Development Bank of South Africa (DBSA) are also supporting the project.

http://www.esi-africa.com/node/15650

Awesome news..

:rock::rock::rock:
:banana::banana::banana:
:applause::applause::applause:


Brilliant news!!!!

Renewable Sector is really cooking...There's wind farms, CSP and PV's under construction...

http://www.pv-magazine.com/news/details/beitrag/south-africa--scatec-solar-commences-construction-on-75-mw-pv-project_100009162/#axzz2C5a9sA1U

Norway-based Scatec Solar has begun construction on a 75 MW photovoltaic project in South Africa, having signed a final agreement with the country’s Department of Energy.


The plant, which has been developed through Scatec Solar’s South African joint venture, Scatec Solar SA, will be built on the Northern Cape, in Kalkbult. It is expected to generate enough energy to supply 35,000 households when complete next autumn. The electricity will be sold to Eskom under a 20 year PPA.

The €200 million capital investment needed for the project will come from South Africa’s Standard Bank. Meanwhile, Scatec Solar is the majority owner and will provide equity financing, along with Stand Bank, Old Mutual Life Assurance Company and Simacel.

"The next two projects that Scatec Solar will construct in South Africa are expected to close in March 2013. When these are in production, Scatec Solar will have completed PV projects of 185 MW in total," said the company in a statement released.

Last week, Standard Bank announced it would underwrite $1 billion worth of debt for the first batch of photovoltaic and wind projects, which signed contracts with South Africa’s Department of Energy under the country’s Renewable Energy Independent Power Producer Programme (REIPPP) on November 5.


Read more: http://www.pv-magazine.com/news/details/beitrag/south-africa--scatec-solar-commences-construction-on-75-mw-pv-project_100009162/#ixzz2C5aT30yw

Some more plants under construction.Going by the whole hush-hush demeanor of the developers there must be tons of money being made in this sector...

Mainstream Renewable Power is set to build 238MW of wind and solar in South Africa, with investments topping €500m.

The company has signed key financing, power-purchase and implementation agreements with the South African Government for the trio of projects, which comprises the 138MW Jeffreys Bay wind farm in the Eastern Cape and two 50MW solar developments in the Northern Cape.

Mainstream said it will issue a notice to proceed to its construction contractors this week. All three projects are slated for full operations by mid-2014.

The company has been developing the projects for the past four years. It was responsible for gaining the consents, grid connections, project finance, construction contracts and equipment procurement.

Mainstream chief executive Eddie O’Connor said the South African government has a tremendous vision to create a sustainable industry.

“This milestone reinforces the leading position of Mainstream in the South African electricity market,” he said.

The projects are expected to create hundreds of jobs during construction and, once operational, the revenue will benefit the local communities.


http://renews.biz/mainstream-kicks-off-238mw-african-build/

I would love to know what the PPA's have in them though....

I think in terms of fairness and openness, given that Eskom are trying to screw us all, that we should know what Eskom is buying their power for.

Food for thought. If fracking gets the go ahead in SA, the country could be catapult into the big league (in addition with good leadership)

US to become 'world's biggest oil producer'

The US will overtake Saudi Arabia as the world's biggest oil producer "by around 2020", an International Energy Agency (IEA) report has said.

The IEA said the reason for this was the big growth and development in the US of extracting oil from shale rock.

This has enabled the US to gain significantly more extractable oil resources.

As a result, the IEA predicts the US will become "all but self-sufficient" in its energy needs by around 2035.

The US shale oil industry has grown significantly in recent years.

It extracts oil from the ground using a method called fracking - pumping down a mixture of sand, water and chemicals at high pressure.

The industry says the method is safe, but critics say it could cause earthquakes and pollute water sources.

The IEA predicts that the US will be producing 11.1 million barrels per day by 2020, compared with 10.6 million from Saudi Arabia.

Currently the US imports about 20% of its total energy needs.

The IEA also expects that the US will overtake Russia as the word's biggest gas producer by 2015, again thanks to fracking, which can also be used to extract natural gas.

It warns that the big growth in US oil and gas production could have significant geopolitical implications, as it may make the US less concerned about the Middle East.

I would love to know what the PPA's have in them though....

I think in terms of fairness and openness, given that Eskom are trying to screw us all, that we should know what Eskom is buying their power for.

I don't know what the actual PPA's contain, but I recall Eskom requested an extra 3c/kwh this year (not sure the basic unit used for electricity consumption) for the roll out of renewable enery sources.

And I think the prices tendered or at least average price of the differing types of electricity is available online.

http://img41.imageshack.us/img41/4158/tumblrljnv4mnzp81qiuwg7.png

WORK ON SOLAR PROJECTS BEGINS IN SA
Friday, 21 December 2012 02:13

New solar power projects will generate local construction jobs and deliver clean, reliable energy to the community.

AE-AMD Renewable Energy, a joint venture between the Spanish AMDA energia and the South African Alt-E Technologies, and Tenesol, a SunPower company,announced two South African ground-mounted solar power projects totaling 33 megawatts (MW).

Both projects, which Tenesol will construct, are located near Douglas, South Africa in the Northern Cape Province.

Herbert, a 22-MW project, has begun construction, and groundbreaking for the 11-MW Greefspan project will begin in the coming weeks. They are both part of the South African government’s Independent Power Producers Procurement Program and completion for both projects is expected in the second quarter of 2014.

The last step in financing took place on Nov. 16 when final agreements were signed-off by the South African Department of Energy.

“SunPower’s successful track record of building solar power plants around the world, coupled with Tenesol’s historic presence in South Africa, will positively impact this region,” said SunPower Regions President Howard Wenger.

“These two solar power projects will generate local construction jobs and deliver clean, reliable energy to the community.”

Both systems will be owned by AE-AMD Renewable Energy in partnership with the IDEAS Fund, an infrastructure fund managed by Old Mutual Investment Group of South Africa that will also resell the electricity to Eskom upon completion of the projects. Tenesol has a 5% share in the two projects.

The ground-mounted solar systems will feature 138,000 Tenesol TE 240 photovoltaic solar panels on single-axis trackers. The solar panels are being produced at the Cape Town manufacturing facility which has been in operation for more than a decade, and has 3BBBEE rating.

About Tenesol and SunPowerFor more than 28 years, Tenesol has been engineering, designing, manufacturing, installing and operating solar energy systems. Its services cover systems that produce or consume the energy they generate (off-grid sites, electricity grid connected, solar water heating) for customers around the globe. In January, Tenesol was acquired by SunPower Corp.

SunPower Corp. designs, manufactures and delivers the highest efficiency, highest reliability solar panels and systems available today. Residential, business, government and utility customers rely on the company’s quarter century of experience and guaranteed performance to provide maximum return on investment throughout the life of the solar system.

Source: Sunpower

Via eProp (http://www.eprop.co.za/news/item/14693-work-on-solar-projects-begins-in-sa.html)

If nuclear energy is not needed, we should not be moving in that direction, especially given the cost (>R1 trillion!!). Other major countries are doing the opposite: moving away from nuclear and towards green energy. We should be doing the same as we have abundant green energy opportunities (and it employs more people). Methinks senior officials have vested interests in nuclear plans going forward...

--------------------

Energy: Nuclear warning sparks meltdown
26 Apr 2013 00:00 - Lionel Faull

A major policy clash over the biggest spending plan in SA's history has erupted between the national planning commission and the energy department.

The trillion-rand plan to build a fleet of new nuclear power stations is not only costlier than expected, but may be entirely unnecessary, according to the research initiated by the commission.

It also warned that the department's commitment to a massive nuclear push could ratchet *electricity prices up by as much as 12% compared with alternative scenarios.

But in a stinging rebuke, the department's energy policy and planning head, Ompi Aphane, dismissed the report as "back-of-a-cigarette-packet energy modelling" produced by "a bunch of academics sitting in a corner ... who do not have a full view of what the government is doing".

The policy battle is an early test of the fledgling commission's mettle, which has been entrusted with developing government's guiding socioeconomic framework, the national development plan, over the next 20 years. The early indications are that the report has been met with irritation, if not outright hostility, by the energy department, which has hitherto been the undisputed custodian of the country's energy policy.

Said Aphane: "The NPC would not have any business going into the nitty-gritty of electricity supply- demand analysis. That is not what the national plan is going to be looking at. It is at a much higher level of planning."

The report runs headlong into the department's stance on nuclear energy. Department director general Nelisiwe Magubane told a parliamentary oversight committee last week that the country's new nuclear build programme was "non-negotiable".

Point of no return
Magubane has raised the stakes in the past, stating that the government would reach a "point of no return" on a new nuclear build decision by June this year.

In direct contrast to Magubane's urgings, a key finding of the NPC report is that "there is more time for South Africa to make this decision ... it is by no means a matter of urgency. The analysis also shows that even with a higher demand and lower nuclear costs, new capacity in nuclear is required only in 2029 and not in 2023 as per [the department's current plan]."

The department's planning is centred on the integrated resources plan 2010 (IRP2010), endorsed by Cabinet in 2011, which introduces 9600MW of nuclear energy into our future energy mix, coming on stream from 2023 onwards.

Because of the long lead times associated with nuclear power, decisions are being worked through now by the national nuclear energy co-ordination committee, chaired by Deputy President Kgalema Motlanthe.

Motlanthe has expressed his support for nuclear energy and the committee has proceeded on the basis that government has already adopted a nuclear policy and it is now a question of determining "how much nuclear, when".

But the research, which was conducted by a team of energy systems analysts from the University of Cape Town's Energy Research Centre, has called into question many of the assumptions contained in the integrated resources plan 2010 and urges the government to update its entire energy road map before embarking on any new procurement.

"Electricity demand growth has been much lower than forecast. It is still below 2007 levels, and future growth is expected to be lower than projected. If followed, the existing plan would result in surplus, stranded and expensive generation capacity," the analysts said.

Nuclear power is identified in the integrated resources plan as a long-term replacement for coal-fired base load and would enable South Africa to reduce its carbon emissions in line with its global commitments.

Copenhagen commitments
However, the analysts' report drops a bombshell: "South Africa could actually still meet the Copenhagen commitments [for carbon emissions from the power sector to peak in 2025] without having to install nuclear plants.

"Many of the low-emission alternatives to nuclear capacity (imported hydro, wind and natural gas) can be installed at lower cost, with shorter lead times, in smaller increments, thus reducing the risk of overbuild.

"The consideration given to flexible options allows rigorous testing of a proposed plan against various outcomes rather than just planning doggedly for one outcome. This approach has a great deal of merit, especially in the context of economic and demand uncertainty.

"The analysis performed clearly shows the importance of updating the IRP2010. Ignoring this new information and fixing decisions, including a large nuclear roll-out of large units on an outdated plan, is going to be costly to the economy.

"Due to the lower demand growth and the committed investment plans [Medupi, Kusile, Ingula and the 2011 renewable energy ministerial determinations] very little further investment is needed before 2025."

Anton Eberhard, a national planning commissioner, said that the commission and the department had already had "a number of interactions" about the national development plan (NDP) and that they would be meeting again to discuss the research.

Future projections
"While they have not been entirely comfortable with our position, they accept, of course, that nuclear cost, timing and financing risk needs to be adequately interrogated," he said.

In response, Aphane challenged the report for relying on "an 18-month window of depressed demand" to make future projections.

He also suggested that demand projections needed to be determined in consultation with stakeholders in government and industry to determine the country's future economic-development needs.

"The NDP's own economic growth aspirations are not supported by the demand curve assumed in this study," he said.

He also zeroed in on the fine *distinction between the national planning commission itself and the researchers who conducted the report on the commission's behalf.

"The researchers are not in government and do not have a full view of what is happening in this space."

Aphane said that the department would, "within days", submit its overall energy master plan – the long-awaited integrated energy plan – to the Cabinet.

An extensive public consultation process will follow, after which the integrated resources plan will also be amended. But what nobody in the department is able to guarantee is that a nuclear decision will not be taken before the department has thoroughly retested its own assumptions and decided upon its overall energy master plan.

http://mg.co.za/article/2013-04-26-00-nuclear-warning-sparks-meltdown

^^There's a running debate in the letters section of Biz Day about this very issue. Although green power is promising, one has to look at the fact that it is much more expensie than normal power, if it has to play a really significant role in our generation mix, the average price of electricity will rise even more.

Secondly green energy still needs to be backed up by constant 24 hour baseload that can only be provided by coal, nuclear, gas or hydro.

If we go the gas route, we will either have to frack the Karoo or import from Moz. If we go with the latter option, electricity prices will fluctuate a lot as we would be importing (could lead to the rand depreciating against the metical), and of course what about the strategic aspect? We cannot depend on Mozambique for our electricity or gas, just see how Russia uses its gas as a foreign policy tool.

Benefits of nuclear are that we have uranium in SA, so the fuel will be priced in rands, so we can conserve our dollars, secondly nuclear stations can last up to 60 years and they generate electricity consistently throughout. Lastly nuclear stations would need to be built at the coast, thus no need for cross-country transmission and a more stable grid with generation inland at coastal.

Lastly the programme costs have come down to R300-400-billion not the R1-trillion cited.

So I do think the politicians do have a point.

In the long-run (which is what we should be focussing on) green energy is the cheapest (and safest) option. Numerous studies have demonstrated that. No sage politician (if there is such a thing) can argue otherwise.

In the long-run (which is what we should be focussing on) green energy is the cheapest (and safest) option. Numerous studies have demonstrated that. No sage politician (if there is such a thing) can argue otherwise.

Green energy is great, but as yet doesn't provide a stable base energy supply anywhere in the world. We need to replace the coal stations as the stable energy supplier the national grid requires. I have yet to be convinced that Nuclear energy is not our best "green" alternative to do this.

S. Africa May Lower Power Levy to Curb Carbon-Tax Effect

By Ana Monteiro & Tshepiso Mokhema
May 2, 2013 10:25 AM GMT+0200

South Africa is considering reducing duties on power from non-renewable sources to counter the effects of a planned carbon-emissions tax on growth, the National Treasury said.

“The impact on the country’s economic growth is shown to be largely neutral if accompanied by effective revenue-recycling measures,” the Pretoria-based Treasury said in an e-mailed statement today. “One of the ways to recycle the expected carbon tax revenue is by reducing other taxes.”

A duty of 120 rand ($13) per metric ton of carbon will apply on 40 percent of a company’s emissions from Jan. 1, 2015, rising by 10 percent each year through 2020. The effective tax rate will range from 12 rand to 48 rand per ton once the tax- free thresholds and other relief measures are accounted for, the Treasury said. It may lower an existing levy on electricity made from coal and nuclear energy, it said. South Africa produces 80 percent of its power from coal.

The country delayed introducing the carbon tax from April this year after metals companies such as ArcelorMittal (MT) South Africa Ltd. and Gold Fields Ltd. (GFI) objected. The nation in 2009 said it would try to cut emissions 34 percent by 2020 on condition that developed countries offer money and technical assistance. South Africa released 547 million tons in 2010, and the transport, oil refining and power generation industries comprised more than 80 percent of emissions in 2000, the Treasury said.

South Africa will raise about 15 billion rand annually from the tax, Cecil Morden, the chief director of tax policy at the Treasury, told reporters at the release of the carbon tax discussion policy paper in Pretoria today.

Emissions Trading

The government of Africa’s biggest economy will investigate the feasibility of an emissions-trading system, which will complement the proposed carbon tax by 2025 or sooner, the Treasury said.

“An emissions-trading system needs a certain number of traders and sufficient trading volumes for the market to operate efficiently,” it said. “The oligopolistic market structure of the energy sector in South Africa may fail to meet these requirements which make the market very ‘thin’.”

The lack of a viable number of industry players “is likely to limit the opportunities for domestic trade in a purely South African trading scheme,” it said.

To contact the reporters on this story: Ana Monteiro in Johannesburg at amonteiro4@bloomberg.net; Tshepiso Mokhema in Johannesburg at tmokhema@bloomberg.net

To contact the editor responsible for this story: Amanda Jordan at ajordan11@bloomberg.net


http://www.bloomberg.com/news/2013-05-02/s-africa-may-lower-power-levy-to-curb-carbon-tax-effect.html

If anyone is interested in reviewing SA's (surprisingly impressive) oil and gas reserves, here's our stats, as of March 2012:

Glossary

- (Tcf): Trillion Cubic Feet
- (bbl): Barrels
- (P50): 50% certainty of being produced

Summary

- SA’s Offshore Prospective Resources gas in place (P50) = 45.9 Tcf
- SA’s Offshore Prospective Resources oil in place (P50) = 9.34 bbl
- SA’s Offshore Contingent Resources gas in place = 3Tcf
- SA’s Offshore Contingent Resources oil in place = 30 bbl
- SA’s Reserves oil in place = 12bbl
- SA’s CBM Prospective Resources gas in place (P50) more than 5 Tcf
- SA’s shale gas Prospective Resources in place (P50) more than 50 Tcf
- Biogenic gas Reserve (P50)= 23 Bscf

http://www.energy.gov.za/files/IEP/presentations/OilandGasReservesInSA_30March2012.pdf

Very interesting stats actually.

Siemens lands R2bn Eskom deal
Creamer Media's Engineering News
17 May, 2013 01:23

Eskom has awarded technology group Siemens with the contract to supply 46 wind turbines to its 100MW Sere wind farm project, which is being developed on a 3700ha site near Vredendal in the Western Cape.
The R2.4-billion renewable energy project will feed electricity into the grid by the first half of 2014.

It is understood the turbine contract comprises about 65% of the project's total capital expenditure, with the other main contract being for the supply, installation and commissioning of a 132kV transmission line and a substation, to be located in close proximity to the project site.

Sere, which takes its name from the Nama word for "cool breeze", is Eskom's first utility-scale wind farm. Public Enterprises Minister Malusi Gigaba has said it would save an estimated 252603 tons a year of carbon emissions.

Director of the Siemens Wind Power Division for Africa and the Middle East, Tom Pedersen, said installation is scheduled to begin in the second half of this year. He said the contract includes the supply of turbines, electrical and civil engineering and a five-year service agreement.

Each turbine has a height of 115m, a rotor diameter of 108m and a power output of 2.3MW.

The turbine order was the second for Siemens in South Africa. The first was awarded by developers of the 138MW Jeffreys Bay wind farm.

The Eastern Cape wind project secured a power purchase agreement in the first bidding round under the independent power producer procurement programme. Mainstream Renewable Power, Globeleq, Thebe Investments, Enzani and Usizo are constructing the project.


http://www.timeslive.co.za/thetimes/2013/05/17/siemens-lands-r2bn-eskom-deal

Eskom's CSP prototype plant exceeds expectations

http://us-cdn.creamermedia.co.za/assets/articles/images/resized/0000232553_resized_bbenergy50413duane.jpg

http://us-cdn.creamermedia.co.za/assets/articles/images/resized/0000232035_resized_bbenergy80413duane.jpg

The 150 kW concentrated solar power (CSP) heated prototype plant at State-owned power utility Eskom’s research and innovation centre, in Rosherville, Germiston, has exceeded design expectations, as it presents immense potential for power station augmentation.

This finding comes after power and energy management and renewable-energy company BBEnergy’s investigations at the Linear Frensel pilot plant, in Rosherville, which included practical operational issues, such as stowing during storms, maintenance effects, startup and shutdown, remote monitoring and control.

The thermodynamic test programme included a closed system test that demonstrated that, in less than one hour, the system exceeded 40 bar and 250 °C when relief valves blew off. A daily cycle variable temperature test, with a range of flow rates from 1 kg/s to 4 kg/s, achieved a maximum of 162.3 kW, while fixed-temperature duty tests indicated an 11.2% variation in heat duty, as the operating temperature varied from 230 °C to 250 °C.

This was highlighted at BBEnergy’s media open day on April 22, where Eskom research and development senior GM Barry MacColl said CSP technology was the beginning of a successful future in renewable energy in South Africa, owing to its predictability in dispatch and its potential to become cost competitive, compared with conventional generation options.

BBEnergy’s Linear Frensel pilot proved that CSP with thermal storage was a viable alternative energy source over other renewable-energy technologies, said MacColl.
Eskom is building a 450 MW CSP thermal plant near Upington, in the Northern Cape, and commissioning is expected to start in 2015.

BBEnergy became the first South African company to design, develop and implement its own CSP heated plant last year. Manager Chris Nell, who also spoke at the media briefing, described the latest data as positive and exciting, as a result of the progress made in its thermodynamic test programme results.

Based on the performance of two earlier prototypes at the company’s Bryanston premises, Eskom awarded the company a contract to construct the thermal pilot plant at Rosherville. The plant was completed towards the end of 2012 and is in the final stages of testing.

“The design strikes a balance between cost, reliability and efficiency, resulting in a commercially viable and modular solar steam generator that provides industrial companies with a strategic source of energy. “The system generates heat using mirrors and tracking systems focus a large area of sunlight onto a fluid-carrying, thermal and receiver tube. “Concentrated energy from the sun heats the fluid flowing through the tube and the resulting thermal energy can be used for various industrial processes such as absorption refrigeration,” explained Nell.

The Linear Fresnel CSP has been used extensively worldwide, particularly in Europe and North America, to generate electricity, but BBEnergy CEO Steven Bluhm told the media that this was the first time that the technology was being harnessed in South Africa to assist the company’s clients in mining and other indus-tries to save on energy costs in a “predictable and meaningful way”.

“CSP systems can produce energy more cost effectively than existing electrical and fossil-fuelled boilers to ease the burden on the already overloaded national grid, particularly during peak-demand periods in the day.

“This is a local design, built by a local company, using more than 95% local content. It is poised to manifest in meaningful energy savings for the national grid and has the potential for significant job creation,” he added.

Eskom also approved separate BBEnergy proposals to construct three larger projects of 600 kW, 1 200 kW and 2 400 kW at Gold Fields and AngloGold Ashanti mines, as part of its Integrated Demand Management initiative. BBEnergy stated that, once operational, these systems would probably be the only CSP heated plants of their kind in the world.

“Additionally, solar electricity generation has the highest power density among renew-able energies and, with thermal storage, can generate electricity in a predictable manner even when the sun is not shining,” explained MacColl.

The 89 000 TW of sunlight reaching the earth’s surface is plentiful – almost 6 000 times more than the 15 TW equivalent of average power consumed by humans, notes Eskom’s website.

CSP power plants can also meet a significant percentage of the future global electricity demand and are especially suited to South Africa, Namibia and Botswana, says the utility.

Engineeringnews (http://engineeringnews.co.za/article/csp-prototype-plant-exceeds-expectations-2013-05-17)

^^ Interesting!

Google invests in South African solar energy plant
May 31, 2013

Consortium will build, own and operate the 96 megawatt solar project, which will be one of the largest solar installations on the continent

The development consortium consisting of SolarReserve, a US developer of utility-scale solar power projects; the Kensani Group, an investment player in South Africa; and Intikon Energy, a South African developer of renewable energy projects, has successfully closed project financing for the Jasper Solar Energy Project – a 96 megawatt (MW DC) solar photovoltaic (PV) project.

The Jasper Project is located in the Northern Cape of South Africa near Kimberly, and was selected by the South Africa Department of Energy (DOE) in May of 2012 in the second round of bids under the South Africa Renewable Energy Independent Power Producer Procurement Program (REIPPPP).

The project also marks Google‘s first renewable energy investment in Africa – the Internet search giant has invested US$12 million (122 million Rand*) investment.

Upon completion, the Jasper Project will be one of the largest solar installations on the continent and will help South Africa meet its renewable energy targets, and power more than 30,000 South African homes.

Rand Merchant Bank (a division of FirstRand Bank Limited) acted as Mandated Lead Arranger and Bookrunner for the Jasper Project’s debt funding requirements. Equity investment for the project was provided by Google, the Public Investment Corporation (PIC), Kensani Capital Investments, SolarReserve, Intikon, Development Bank of South Africa and the P.E.A.C.E. Humansrus Fund, with Rand Merchant Bank providing preference share equity. International law firm Baker & McKenzie supported the project activities through its offices in Johannesburg and the United States, with Kensani Eaglestone Capital Advisory acting as financial adviser.

The Jasper project has executed a 20-year power purchase agreement with Eskom, the South African power utility. The project cost of approximately ZAR2.3 billion ($260 million) will make this one of the single largest PV projects in Africa. The Jasper project is located adjacent to the 75 MW Lesedi Solar Energy Project, which broke ground in February 2013. The Jasper and Lesedi Projects, along with the Letsatsi Project located near Bloemfontein, put the consortium’s total portfolio of successful solar projects at 244 MW, accounting for a 20 percent share of South Africa’s solar energy market.

The project has an annual operations and maintenance budget of ZAR 36.5 million ($4 million) for staff, services and spare parts. The project will also set aside a percentage of total project revenues for enterprise and socio-economic development, amounting to a total of approximately ZAR 230 million ($26 million) over the life of the project, which will be invested for the benefit of the local communities surrounding the project.

Source: MyBroadband (http://mybroadband.co.za/news/insight/79117-google-invests-in-south-african-solar-energy-plant.html)

SA's green job hopes hit red light

07 Jun 2013 00:00
COMMENT Dirk de Vos

Trade rules, oversupply and advances in solar tech are spelling trouble for local energy industry.

http://cdn.mg.co.za/crop/content/images/2013/06/06/DARLING---WIND-FARM_DH_0322.jpg/676x380/
Wind factor: The technology is mature, its components are oversupplied and local start-ups are prohibitively expensive. (David Harrison, M&G)


Much has been made about green industry being a new vehicle for industrial development in South Africa. It is part of the industrial policy action plan. For now the focus is mainly on increasing the local content of components, which fall under the renewable energy independent producers procurement programme.

The programme emerged from the integrated development plan that maps out South Africa's energy future to 2030. Eskom's need to procure renewable energy arises from South Africa's international commitment to reduce greenhouse gas emissions by 34% by 2020.

The procurement programme involves competitive bidding over a feed-in tariff. If a power producer is selected, it can sell renewable electricity to the grid under 20-year power purchase agreements signed with Eskom but guaranteed by the government.

In general terms, electricity generated from wind, solar, hydro and other renewable sources is sold at a premium, above that of electricity generated from coal-fired power plants. As we have seen, this premium is rapidly decreasing in relation to the two main renewable technologies, onshore wind turbines and photovoltaic (PV) solar plants, and looks set to disappear. Both onshore wind and the solar PV have the holy grail of grid parity well within their sights.

Still, to the extent that a renewable power producer does not have any demand risk — Eskom is obliged to purchase everything it produces — there is a subsidy. And the existence of a subsidy of any type pushes governments to look at building a local industry that provides other benefits. The procurement programme places considerable emphasis on local content to ensure that the economy benefits from the construction of renewable energy facilities. All project developers must comply with the local content requirements.

The tender document requesting proposals defines local content in terms of the total costs of the project at the commercial operation date that will be spent on South Africans and South African products. These costs specifically exclude finance charges, land and mobilisation fees.

Local content requirement
For onshore wind, there was a 25% local content requirement in the first two rounds of bidding but the third round will see this go up to 45%. At this level, local content moves from mere provision of support structures to actual blade and turbine contributions. For solar PV, the first two bidding rounds of the programme started out at 35% but this is due to be raised to 60% in the third bidding round. To reach future local procurement levels, new local manufacturing capacity will need to be built.

The capital expenditure associated with constructing local manufacturing plants in both wind and solar PV gear is significant and currently there is a bloodbath in the renewables manufacturing sector.

When renewable energy equipment manufacturers around the world are either going bankrupt or severely cutting back, we need to think very carefully about our localisation policies. We risk investing in manufacturing facilities that will be underutilised or loss-making.

But there is another looming challenge: almost every country that has its own renewable energy programme based on a feed-in tariff has developed more or less the same type of policies on local procurement.

In December, a panel established by the World Trade Organisation's (WTO) dispute settlement body ruled against Ontario's feed-in tariff local content rules. It required developers to source at least 60% of their equipment for solar PV projects locally, and at least 25% for wind projects.

The WTO panel found that Ontario's local content rules breached the General Agreement on Tariffs and Trade 1994 (Gatt) by treating imported products less favourably than domestic products.

Trade dispute
It said that, by treating domestic and imported renewable energy equipment and components differently, Ontario's local content requirements breached Canada's obligations under the Gatt and the international Agreement on Trade-Related Investment Measures. China has already said that it will use this ruling to challenge similar local content rules of European Union member states.

In the United States, there is a serious trade dispute with China. The original American complaint was that Chinese solar panel manufacturers were being subsidised and dumping panels on to the American market. These panels, the US complained, have been acquired by American renewable power plants that are subsidised by the American government.

In response, the US imposed several anti-dumping and countervailing duties on the Chinese goods. The EU has now also joined the fray and China is taking its first steps towards retaliatory measures.

As we have seen from the drawn-out Walmart/Massmart merger, in which the department of trade and industry sought to impose local procurement conditions on the deal, South Africa also has obligations to the WTO and will be bound by a final WTO decision on the matter.

Leaving that aside, if South Africa is to establish local manufacturing capacity, we will have to decide exactly which part of the renewables value chain should enjoy priority.

On the face of it, building manufacturing capacity in wind power does not look attractive. It is a mature industry with massive global manufacturing over-capacity. Wind has a known theoretical upper limit, according to the Betz law. It describes the maximum energy that can be harvested from wind. Future improvements in the field will be slow and incremental, at best.

Solar PV
Solar PV is different: although accounting for about 0.25% of the global electricity supply, its share is growing more quickly than any other power source. Solar PV installations grew 86% in 2011. This trend is set to continue.

It is the analogue of the semiconductor industry's rule about transistors, Moore's law, which observes that the size of transistors and also their cost halves every 18 months.

Promoters of solar PV point to Swanson's law. Swanson's law is the observation that the cost of the photovoltaic cells needed to generate solar power falls by 20% with each doubling of global manufacturing capacity.

To some extent, South Africa has seen Swanson's law in action. The first-round bidding for solar PV in the procurement programme at the end of 2011 saw an average tariff of about R2.75 a kilowatt hour (kWh); the second round, less than six months later, produced an average tariff of R1.65/kWh, a fall of more than 40%. Granted, round-two bidding was more competitive, but Swanson's law played a big part in this decline.

The local content increases mandated by the procurement programme followed a study by the department, the South African Photovoltaic Industry Association and the World Wildlife Fund, which have now commissioned a PV localisation study.

The trouble is that competition in solar PV panels made from crystalline silicon is brutal, but there is another risk — unlike in wind turbines, there have been several major technological advances in solar energy that could seriously disrupt the current industry. At present, most PV solar panel production has already moved to China because of cheap and relatively skilled labour. But profit margins are razor thin or even nonexistent.

Chinese-built components
So, although governments are concerned that Chinese-built components are being used by developers enjoying local feed-in tariff subsidies, a better view might be that the Chinese government is subsidising the world in getting more solar PV stations for the available money. China has contributed massively to Swanson's law but derives no benefit from it.

But the larger problem, say proponents of green industry industrialisation, is that China's approach will mean that it will reap all the green jobs of the future.

This is probably incorrect. The future of solar energy does not lie with existing technologies — it will come from the nascent field of nanotechnology.

Certainly, PV panels manufactured from crystalline silicon will continue to get cheaper, in line with Swanson's law. But precisely structured materials developed in well-funded nanotech laboratories are able to split sunlight into different colours and direct them to solar cells with semiconductors that are matched perfectly to each colour.

In this way, the energy contained in each slice of the spectrum is converted to electricity, rather than to heat, as is the case with current PV panels, so much more of the solar spectrum is absorbed. Efficiency jumps from about 15% to 40%. Full commercialisation is some way off but the manufacturing tools needed to make these nanostructured materials are already starting to emerge.

Another approach, also using nanotechnology, has seen researchers creating quantum dot solar cells. Films of these quantum dot cells can be created quickly and at low cost, similar to paint or ink. The real genius of this is not their converting efficiency of about 7% but the fact that, once in production, it could be so cheap that huge areas could be covered with it. Efficiency is not the point — cost per watt is.

The South African government might be in a good place to make heavy demands on renewable energy developers right now, who are likely to do what they can to increase local procurement.

But, although the government might succeed in developing local manufacturing capacity, we should be very careful about what we want. There is no point in building up capacity in a plethora of low-margin, sunset industries.

Dirk de Vos is a consultant in renewable energy and telecommunications


http://mg.co.za/article/2013-06-07-00-sas-green-job-hopes-hit-red-light

17 June 2013 23:26
First power from Medupi by end 2013 increasingly unlikely
http://www.moneyweb.co.za (http://www.moneyweb.co.za/moneyweb-soapbox/first-power-from-medupi-by-end-2013-increasingly-u)

increasingly unlikely?

I haven't been expecting power from Medupi anytime before Q4 of 2014 tbh.