As the provider of 95% of power in South Africa and 45% of power across the African continent, Eskom is truly a force to be reckoned with. But the state-owned public utility does not have the cleanest track record. It generates the majority of its electricity from South Africa’s copious coal resources and, as a result, is one of the world’s 10 largest polluters. However, with the government aiming to procure 30% of the country’s energy from renewable sources by 2030, Eskom is cleaning up its act.
Leading the company’s move towards cleaner energy is Ayanda Nakedi, Eskom’s Senior General Manager for Renewables. She explains that the company has, in fact, had some renewable energy capacity from the beginning.
“Eskom still operates 62 megawatts of small hydroelectric capacity in the Eastern Cape that was installed in 1984,” she says.
“This was our only source of renewable energy generation for years, until the South African government committed to diversifying the country’s energy mix to reduce its carbon footprint. Eskom joined in with this effort and committed to introducing more renewable energy into its portfolio.”
Ayanda adds that, with South Africa’s plentiful wind and solar resources – and renewable energy becoming an increasingly lucrative market – the move made sense in more ways than one.
One of Eskom’s simplest ‘green shifts’ was installing solar photovoltaic (PV) panels on the roof of its head office to provide power for its own needs. The company is currently expanding this initiative by installing rooftop solar on all the buildings it owns, including power plants. At this point in time, Eskom’s total solar PV capacity totals 2.3 megawatts.
Sere Wind Farm
Eskom began developing its first large-scale renewable energy project in 2006. This was the Sere Wind Farm, a 100-megawatt project close to the town of Koekenaap within the Western Cape. The project was delayed initially due to insufficient funding, but eventually it managed to secure funding from the World Bank, the African Development Bank, the Clean Technology Fund, and the French development bank AFD. Construction began in December 2013.
Building the Sere Wind Farm was a challenging endeavour, particularly when it came to logistics. Back when the project was first being developed, no wind turbines were manufactured in South Africa. This meant that they had to be imported from overseas and transported to the project site from the Port of Saldanha Bay, on the southwestern coast of South Africa.
“Moving the very large equipment from the port to the site was one of the biggest challenges,” says Ayanda. “Further challenges included securing the licence and permits, as well as managing stakeholder’s expectations. This was particularly important, because the wind farm took 18 months to build and during that time we tried to source as much labour and equipment from the local municipality as possible.”
Despite these challenges, Sere Wind Farm was fully commissioned in March 2015, on time and on budget. Its 46 turbines produce about 298,000 megawatt-hours annually, which is enough to supply 124,000 standard homes. It is expected to save nearly 6 million tons of greenhouse gas emissions over its 20-year life. Ayanda says that its completion marks a significant milestone for Eskom.
“The fact that the plant was built on time and on budget proves that Eskom as a utility can deliver such projects in partnership with the private sector,” she remarks.
“It demonstrates Eskom’s commitment to renewable energy, and our ability to deliver it – all of which would strengthen our position to receive a further allocation for more plants.”
With Sere Wind Farm in full operation, Eskom is busy planning its next renewable energy projects.
First in line is a 100-megawatt concentrated solar power (CSP) plant being developed near Upington in the Northern Cape. The facility will consist of the central receiver technology and use molten salt to store between nine and twelve hours of thermal energy. Eskom is currently procuring an EPC contractor for the project, and construction could begin as soon as 2016.
Besides that, Ayanda says the company is busy planning the development of “some more wind plants, as well as some more PV and CSP plants”.
It’s clear that the growth of renewable energy is providing Eskom with new opportunities; however, it is also producing new challenges. One of these is the potential for Eskom’s customers to begin installing their own rooftop solar, thus reducing or even eliminating their reliance on Eskom’s grid power.
“We see how this move away from the traditional centralised generation model could have a significant impact on Eskom’s revenues, so to pre-empt this move we are adapting our business model,” says Ayanda.
“We are preparing ourselves to enter the small-embedded generation [SSEG] market, which incentivises customers to install rooftop PV, ourselves. These customers are essentially our customers, so it makes sense for us to offer them this rooftop PV first, and to give them a great tariff.”
Underlying Eskom’s aim to increase its renewable energy capacity is an aim to increase its generation capacity overall. It’s no secret that South Africa has an energy shortage, with only 80% electrification and frequent load shedding across the grid. Eskom’s main goal is to fix these problems.
“We are prioritising maintenance of our existing assets, and prioritising building new plants to address our supply constraints; one of these will be the Medupi power station, which will be one of the largest coal-fired plants in the world,” says Ayanda.
“We are also introducing demand-side management, by encouraging businesses and individuals to use less electricity. We are doing this by providing a tariff that incentivises them to be energy efficient.”
The message to take from this is that ensuring a sustainable energy supply for South Africa will require cooperation from everyone – from government to individuals. With its commitment to continue building renewable capacity, it seems Eskom is certainly playing its part.
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