Posted in: Energy storage

Load Shedding Solutions for Your Business

Load Shedding, unfortunately, has become a norm in South Africa. Even though load shedding takes place to stop the entire country from experiencing a permanent blackout (by the collapsing of the whole electricity supply grid), load shedding still has major negative effects on the economy in South Africa. 

Several reports now estimate that South Africa will experience severe load shedding for at least two more years. The frequency of load shedding, even during COVID 19’s economic standstill, indicates just how fragile Eskom’s fleet has become, and businesses have to find a solution to remain operational. The positive news is that a plethora of technology now exists which can help your business to find a solution to ending the nightmare of operational disturbances.

The causes of load shedding 

Load shedding happens when there is not enough electricity available to meet the demand of all customers. In order to maintain grid stability, the electricity utility supplier will interrupt the energy supply to certain areas on a rotational basis.  The winter-months are prone to load shedding, as it can be  caused by the higher demand for electricity during cold weather, which causes the power station stations to be overloaded and  struggle to  keep up with generating the needed electricity capacity.

According to Eskom and government officials, the solution is a capacity problem, requiring the construction of additional power stations and generators. However, the procurement of additional national capacity could be a lengthy process. In the meantime, there are alternative electricity solutions to help businesses during load shedding.

Various methods can be used to minimise the impact of load shedding, and below we suggest a few solutions businesses can use to see their operational disturbances be minimised. 

Solutions to load shedding

1. Uninterruptible power supply systems (UPS systems) 

A UPS is an electrical apparatus that provides emergency power to a load when the main power supply or utility power fails.

A UPS is the bare minimum when it comes to business operational management, as it allows for the safe, orderly shutdown of computers and connected equipment. The size and design of a UPS will determine how long it will supply power.

A UPS will only work if power banks are fully charged and on standby when needed. Unfortunately these are short term solutions, due to the fact that the power banks may run out of power before the electricity comes back on. This means that, once the UPS’s reserve has been depleted, there is no alternative supply of power, which might negatively impact productivity and affect day to day operating of the business.

2. Backup generator  

Many businesses have turned to backup generators to ensure the continuous supply of power. Generators typically use diesel or gas, and convert mechanical energy into electrical energy as the output. 

Gas generators can be used for residential emergency power supply and can last about 2 to 3 hours,  which may not be ideal for a business function. Diesel generators, on the other hand, can run for 20 – 30 hours, depending on their capacity.

However, with the ever increasing price of fuel, running a generator can become prohibitively expensive. The lifespan of a generator depends on its run hours – a generator that is used infrequently could last around 20 years. In a scenario of increased and consistent load shedding, generators may need to be replaced more frequently. 

In addition, it is important to consider the noise and fumes that a generator might emit, which can be an additional frustration to an already stressful working environment. 

Diesel generators on Robben Island

3. Grid-tied PV Solar system 

A solar PV system is composed of solar modules combined with an inverter and other electrical and mechanical hardware that use energy from the sun to generate electricity. PV systems can vary greatly in size, from small rooftop or portable systems to massive utility-scale generation plants. In South Africa, which has fantastic irradiation, solar PV tends to be the most affordable kind of power to generate.

However, typical solar PV systems are grid-tied, meaning that they would go down during load shedding. This is because, although the sun may continue to shine during a power outage, the inverters will automatically switch off in the event of a grid outage. An inverter is required for solar PV systems in South Africa, to convert the DC power generated by the modules to AC power, which is used in buildings and commercial operations. Inverters are designed to switch off in the event of a power outage, to ensure the safety of personnel that could be working on the grid during an outage.

Luckily, a simple “workaround” can ensure that during the day, a solar PV system can still remain operational during a power outage. As we explained in our previous post about load shedding, installing hardware and a simple generator/UPS system can ensure that inverters remain on during outages, and the solar PV system can continue to generate low-cost power during this time. Several SOLA customers have used this technology, such as Old Mutual Park. 

Old Mutual Solar Carport

Installing a solar PV system is a great cost effective way to get your business not having to deal with the crisis of load shedding in South Africa.

4. Off-grid solar PV system

An off-grid solar PV and battery system, also known as a stand-alone power system (SAPS), or solar PV microgrid, works by balancing several electricity sources, such as solar PV and batteries. Solar PV microgrids work by generating electricity from solar modules and using them to charge a battery via a charger controller.

An off-grid system works independently of a utility grid , which makes it an independent power generation source, ideal for remote or rural areas, such as the microgrid in Clanwilliam’s Cedar mill Mall.  However, with increased load shedding, this form of electricity generation is starting to make financial sense in urban areas too.

Although many companies may be reluctant to move off-grid,  solar PV microgrids are becoming the most long-term and cost effective solution for permanent power supply in South Africa. 

Cedar Mill Mall Solar PV Microgrid

Conclusion

With the prospect of load shedding being around for at least another three years, considering viable alternative sources of power is important for business. With the rising tariffs and other issues at Eskom, companies need to seek out the best alternative power generation options for their businesses. 

Now that we are ready to “reopen” our economy after the COVID 19 lockdown, load shedding will be a reality for many businesses. The good news is that there are lots of options for business owners to ensure continuous power – whether through a  UPS system, backup generators or solar PV systems. The options are there to help ease your mind with the effect that load shedding has caused to businesses.

Mining in africa

Why remote mines in Africa should be considering energy storage

There is no doubt that solar PV is the cheapest form of electricity generation globally. However, how does its application apply to remote mining operations? Africa is blessed with great solar resource, as well as mineral and metal resources – making mining an important industry on the continent. But remotely-located mining operations often mean that energy generation is an important concern. 

If a mining operation is located close to a utility grid, there could be an option to commission a new power line or grid connection to the mine. Whilst this may seem like an appealing option, there are many uncertainties in the creation of a new power line, and even in connecting to an existing one. How long will the powerline take to build? How will it be maintained and/or repaired when necessary? What would the costs be of such a connection? These questions need to be asked in conjunction with the political, regulatory and logistical risk considerations in taking on such an intervention. There is also the risk of the existing grid or utility being unreliable with frequent outages. 

Another consideration is the risk of using an outmoded form of technology, and what the implications of this might be for the future of your mining operation. Using mobile technology as an example, Africa has been able to leapfrog fixed line telecommunications straight to mobile phones, which has improved livelihoods on the continent substantially. A similar argument can be made for the fixed line electricity grid: decentralised electricity supply enable the opportunity to leapfrog outdated technology and maintenance that comes with fixed power lines to provide decentralised, reliable power. 

As such, many mines in Africa do rely on decentralised power, either in the form of diesel or solar PV. In addition to these decentralised power generation sources, battery storage is a great option to reduce costs and risks of power supply. 

Lithium Ion Battery Storage solar PV microgrid

The most common go-to option for remote mining solutions is diesel generation, due to its portability and reliability for remote mining operations. However, diesel is a costly option. Typically, diesel costs in African gold mining countries are around US$1 per litre of diesel – which translates to US 30c per kWh. This is in comparison to US 5c per kWh of solar PV electricity. Another consideration is the transportation of diesel to the mine site, which ironically is burning diesel to, in turn, burn more diesel. Despite the greenhouse gas emissions implications of this, it also adds an unnecessary layer of costs to the mining operation.

But is there another way? As mentioned above, many remote mines in Africa, whilst distanced to the utility grid and/or high-voltage grid connections, have fantastic solar resource. With the affordability of solar PV solutions, it makes sense to explore a solar PV system for mining operations in Africa. However, to provide power after hours and/or during the early hours of morning or late hours of evening, solar PV needs to be used in conjunction with a backup supply to keep the energy supply consistent. This might take the form of diesel generators, but energy storage – particularly in the form of lithium-ion batteries – is quickly becoming a less risky option. This is, in part, to the falling costs of energy storage technology. 

With costs of storage rapidly decreasing, energy storage provides a much more stable cost profile than grid-powered or diesel generated electricity, which both have unknown future cost fluctuations and risks. Similarly, the increased interest in electric vehicles, as well as global uptake of off-grid electricity, have sparked a sharp decline in battery costs.  

In addition, battery manufacturing capacity is expected to increase significantly by 2021 from just under 150 GWh/year in 2018 to 350 GWh/year in 2021, with the bulk of manufacturing taking place in China and the US. A similar forecast predicts an increase in manufacturing capacity from 350 GWh/year, to ~700 GWh/year. Similarly, the average battery plant manufacturing size has increased significantly, from around 10 GWh/year to just under 30 GWh/year. 

In conjunction with increased global demand and manufacturing capability, the costs of lithium-ion batteries have decreased significantly from 2013 – 2019, from around US$ 446 per kWh in 2013 to US$ 112 per kWh in 2019. 

Should the application of a solar PV and battery storage microgrid system be unfeasible for a mining operation, battery storage can still assist mining operations to save money by extending the life of generators by creating spinning reserve. This can create a ~2% diesel saving – or 2 MVA of batteries of spinning reserve could save ~260 000 litres of diesel.

A solar PV and energy storage microgrid ensures the control of power and energy sources. A high concentration of renewable energy, such as solar PV, in conjunction with storage, enables complete control of energy costs, eliminating logistics risks and price fluctuations. There are also various financing options available, such as buying the system outright or entering into a power purchase agreement. 
As mentioned, solar PV on the African continent is a no brainer. However, for remote mines, it may be necessary to install solar PV alongside battery storage solutions. Whilst solar PV saves money, energy storage solutions solve a few problems: they provide consistent energy supply and handle load changes, and also ensure that the costs of supplying power to the mining operation are known. This reduces much of the risk of electricity supply for both planned and existing mining operations.

Solar for mining operations

Solar PV Microgrids for Mining: cost-cutting meets sustainability

The mining sector is one of the most important economic contributors to the African economy. However, mining is also facing several challenges – particularly with regards to sustainability and cost-saving. Mining operations are increasingly turning to solar PV microgrids as a reliable and sustainable alternative energy option.

Cost-cutting competitiveness

A 2019 Mckinsey review on measures to invigorate the South African mining industry identified cost-cutting competitiveness as a key factor. As an energy-intensive industry with a projected increase in energy consumption of 36% by 2035, the mining sector is looking to renewable energy, and particularly solar, as a significant cost-saving solution. This is evident in the agenda set for the 2020 Investing in Africa Mining Indaba taking place in Cape Town at the beginning of February, where industry experts will lead the conversation on the economic and societal benefits of renewable energy in mining.

A shift in industry thinking

proactive mitigation of ESG risks creates long term shareholder value.

Speaking to Engineering News & Mining Weekly Tom Quinn, an organiser of Mining Indaba, emphasised that:

‘It is now absolutely necessary for mining companies to have ongoing engagement with their investors and with the communities in which they operate in order to mitigate the risk of investor or community backlash from a lack of sustainable practices.’

This shift in industry thinking is aided by the economic benefits associated with using renewables such as solar PV microgrids to supplement more traditional energy sources. It is now widely accepted that maintaining a Triple Bottom Line is key to responsible investment. IFC’s Global Head of Mining Namrata Thaper advises that:

‘[E]xperience has shown that proactive mitigation of ESG risks creates long term shareholder value. This value is created by ensuring alignment between stakeholders and thereby reducing the likelihood of disagreements between stakeholders, which can lead to cancellation of concessions by government, labour unrest and strikes, community blocking or stopping of operations and more which are all events that can negatively impact financial performance…’

Renewable trends

‘The most advanced options… are hybrid systems that integrate solar, wind and batteries with diesel, gas or heavy fuel oil generators, without compromising reliability or power quality.’

For the mining industry, who rely heavily on consistent, uninterrupted power, the key energy trends to watch in 2020 are hybrid power, advances in renewables technology, variable power usage, intelligent seamless integration and meaningful cost savings.

Climate change, loadshedding and the fluctuating diesel price

However it is not just Triple Bottom Line reporting that is pushing mining companies to seek renewable energy solutions. Threats to productivity in the southern African region include unplanned breakdowns at state-run electricity utility Eskom, the fluctuating diesel price and supply disruption risks in the SADC region. The reliability of solar PV microgrids can mitigate these risks significantly.

On a global scale interruptions to energy production as a result of violent weather conditions caused by climate change has resulted in a growing shift to renewable energy. In response to this new challenge, businesses are focused on ramping up energy efficiency and reducing carbon emissions. Spencer Glendon, a senior fellow at Woods Hole Research Center cautions that climate change may be altering the economics of long-term infrastructure investment. It is crucial to ensure that one’s power supply is independent of at risk utility plants.

Solar PV microgrids offer a hybrid solution to these obstacles. In cases of remote locations, weak grid supply and reliance on diesel, there is an optimal business case for mines to use a solar PV microgrid. This typically combines a backup generator with batteries and solar to ensure a seamless transition and no interruption of power.

Positive outlook for solar PV globally and locally

‘the world’s total renewables-based power capacity will grow by 50% between 2019 and 2024’

The International Energy Agency’s (IEA’s) 2019 renewable energy market forecast for solar PV states that ‘the world’s total renewables-based power capacity will grow by 50% between 2019 and 2024’. Thus as there is a global transition to a varied renewable power sources the southern African region will find itself at a competitive advantage due to its strong irradiance levels (South Africa average more than 2 500 hours of sunshine per year). As a result of falling costs of solar PV and batteries worldwide, microgrids are now accepted as a reliable and cost-effective solution for industrial power generation.

The added benefits of third party financing

Financed solutions allows mining facilities to achieve immediate savings with no initial capex outlay. A solar Power Purchase Agreement (PPA) enables businesses to pay off and maintain their own solar energy systems at no upfront costs, while enjoying the immediate benefit of cost savings. Solar PV microgrids are increasingly the option of choice when looking to adopt a reliable, affordable, and sustainable energy solution.

Solar Microgrids and Battery Storage

Achieving electricity cost reductions through energy storage

Achieving electricity cost reductions through energy storage: what Business needs to know

Energy storage represents the major opportunity for the electricity sector, as affordable energy storage promises to solve the intermittency issues that occur with cheap renewable power such as solar PV and wind energy. Over the past few years, rapid declines in the cost of energy storage technologies, such as lithium-ion batteries, have made the topic of energy storage enter mainstream conversations. However, does energy storage as it currently stands translate into cost savings for business? 

From electric vehicles to large-scale utility batteries: the global market context

The popularity of electric vehicle (EV) technology in many ways has facilitated rapid growth in the energy storage services market, driving down the costs of Lithium-ion batteries and associated technology. Daniel Goldstuck, head of Energy Storage and Microgrid Services at SOLA, believes that the progression of storage products and services can be clearly seen in the increasing presence of battery suppliers and other industry service providers at conferences, who tout their ability to provide reliable, high-tech solutions to intermittency battles. In addition, the mushrooming of utility-scale battery programmes globally indicates that interest in energy storage is entering the large-scale energy services market, leading potential clients to see energy storage as a potential solution to some of their needs. “The procurement of large-scale transmission assets ‘in front of the meter’ shows that utilities are starting to use energy storage to provide a number of services, including frequency response, renewables smoothing, and transmission deferral,” Goldstuck asserts. 

The uptake of such solutions is expanding globally. California, for example, has over 1 GW of storage solutions installed, and the state also provides rebates for residential storage systems. In Africa, Microgrids that combine energy-storage technology with clean energy generation are lauded for their ability to provide stable power to communities with weak or no grid access. Pico-grids, or home solar kits, are also increasingly seen as ways to assist rural homesteads and villages with electricity provision. 

However, the application of microgrids and energy storage solutions do not only apply to rural and utility scale efforts, but also to the large segment of commercial and industrial energy consumers in between. Rurally-located mining operations, for example, can benefit from energy storage applications that link to cheap and reliable renewables, moving operations to electricity that is less cost- and carbon- intensive than diesel.

storage and solar PV: a perfect match

Solar PV is the cheapest form of energy in most countries globally. This is because it is solar power is an abundant renewable resource, the technology to harness it is relatively cheap to install, and it lasts for 20-plus years. However, solar PV is most abundant in the middle of the day, and starts to wane during “peak” energy hours such as early morning and evening. When combined with energy storage, the abundant, cheap electricity generated by the sun during midday can be stored and deployed during these peak usage times. Because storage is also programmable, it can be deployed when most needed – preventing wastage and increasing the economic value of each kWh stored. 

However, this programmable aspect of microgrids also make them more expensive than the typical grid-tied solar PV facility. “Solar PV and storage microgrids need to function seamlessly, so that power is not interrupted, and battery life needs to be managed carefully in order to ensure their longevity. This takes quite specific and extensive engineering to get right,” Goldstuck adds. 

Issues such as cycling the battery every day can affect the warranty of the product, depending on the type of battery and warranty arrangement. Energy throughput of the battery has the largest impact on the life of the battery, and therefore the warranty. Unlike solar modules that have a 25 year lifespan and relatively low operations and maintenance requirements, batteries need to be very carefully sized and configured, taking into account things like days with low-irradiance or cloud cover, where batteries may be put under pressure.

Although renewables and energy storage solutions are a perfect combination in a world headed towards increased renewables, the above factors mean that at the moment, the combination of solar PV and batteries into microgrids is more costly than straight grid-tied solar PV.

When does storage make sense economically?

However, the business case for storage and microgrid solutions is very clear for certain business sectors. “Rurally located agro-processing units such as medicinal cannabis farms are particularly well-positioned to make use of renewable energy storage microgrids,” contends Goldstuck. “They require consistent, large amounts of reliable electricity in order to power greenhouses and other farming equipment – yet are often situated on constrained grid networks and may rely heavily on diesel to run effectively,” he adds.

Diesel is expensive, both monetarily and environmentally, and yet diesel generators are widely used to power remote facilities. Diesel generators have even been used in South Africa to maintain the grid supply whilst there was constraint to major power stations. And despite energy storage solutions still being pricier than solar PV, diesel is still more expensive than the combination of both. Given that diesel is so expensive, the business case for implementing a clean-energy microgrid is particularly good  in relation to diesel saved.  

In contrast, storage for grid-tied facilities seeking a tariff-optimization solution generally requires closer analysis to determine the business case. “In South Africa, only a few tariff structures are currently at the price point to justify adding a storage asset. This is rapidly changing as the cost of storage decreases, and the costs of centralised electricity supply increases,” adds Goldstuck.

Energy storage economics cheat sheet

As a rule of thumb, energy storage microgrid solutions will make economic sense if they prevent at least 30% of the facility’s current or proposed diesel usage. Such cases are typically:

  1. Facilities on a weak or constrained grid network that need additional power to function
  2. Facilities without electricity grid access
  3. Facilities requiring consistent power that the grid is not able to provide for at least 30% of the time. 

Based on the above criteria, the following industries lend themselves particularly well to solar PV and energy storage microgrids:

  1. Islands without electricity grid access, or where the grid itself is powered by diesel (such as Robben Island)
  2. Game lodges or hotels that do not have access to the grid
  3. Large developments in rural settings that require more power than the grid can provide (such as the Cedar Mill Mall development)
  4. Mining operations situated remotely
  5. Farms that have extensive greenhousing requirements such as Medicinal Cannabis facilities 
  6. On-grid buildings experiencing outages for more than 30% of the time.

In conclusion, Goldstuck admits that there is a long way to go before large-scale energy storage solutions can be broadly implemented. However, he remains optimistic. “We’re just scratching the surface of what’s possible in terms of storing the abundant renewable resources we have available. In the years to come, energy storage solutions will become widespread options for commercial and industrial facilities”.

Solar Microgrids and Battery Storage


How to prevent loadshedding in commercial buildings

3 Options to proof your commercial and industrial building from load shedding

The nationwide spate of load shedding in South Africa is not just a highly frustrating situation for individuals: it is a hindrance to businesses and the economy in general. As South Africa starts to approach level 5 and 6 load shedding scenarios, it is important to look at the alternatives available to businesses around the country in order to prevent the loss of productivity across the board. At the same time, various different alternative sources of power should be evaluated based on their cost-effectiveness and environmental impact. The following article explores various load shedding prevention methods for commercial and industrial buildings.

Option 1: Using backup diesel generator

Option 2: Retrofitting a grid-tied solar PV system

Option 3: Going off grid using a solar PV/battery microgrid


Option 1: Using backup generators

This commonly used form of commercial backup power consists of diesel gensets that switch on when the power goes off. This is a good option for ad-hoc power cuts in places that cannot afford to lose power, such as hospitals, convention centres and large retail centres.

Before relying on a diesel backup generator, though, the system should be tested with the total load of the building to make sure that it is able to take the full electricity load. If it not possible for the gensets to handle the building’s entire load, an “emergency” scenario – where nothing but the critical systems are backed up – should be tested. An Automatic Transfer Switch (ATS) will be needed to ensure that when the power goes off, the diesel generators are initiated.

Within Eskom’s current loadshedding trajectory, using backup diesel generators is likely to be very expensive, depending on the load size of the building. Diesel itself is much more expensive per kWh than typical Eskom tariffs, and even more expensive when compared with the costs per kWh of solar PV. When evaluating the efficacy of installing diesel gensets, the following questions should be asked:

  1. How many hours per day will the genset(s) be required?
  2. How many litres of diesel are likely to be required?
  3. What are the ongoing maintenance requirements of consistently using diesel generators?
Robben Island has historically used diesel generators to provide the power needed on the island.
Robben Island has historically used diesel generators to provide the power needed on the island.

Option 2: Retrofitting a grid-tied solar PV system

In South Africa, many commercial buildings – hospitals, retail centres, distribution centres, etc – have grid-tied solar PV systems that supply power from the sun during the day. These relatively simple systems are tied to the grid, so they do not provide 100% of the offtaker energy requirement but rather supplement it. Unfortunately, grid-tied solar PV systems do not automatically prevent a building from experiencing load shedding.

Because solar generates Direct Current (DC) power, this needs to be converted into Alternating Current (AC) to be used in buildings as electricity. In order for a solar system to produce usable electricity, therefore, a solar inverter is required. However solar inverters are designed to switch off during a grid outage.

Why is this? For grid-tied solar PV systems, this serves as a vital safety mechanism for personnel that might be working on transmission lines during outages. With solar inverters off, buildings with solar PV systems are prevented from generating power during a grid outage and potentially exporting power to the national grid, which could be fatal for maintenance personnel.

Solar inverters are designed according to international safety standards that require this functionality, which means that grid-tied inverters cannot operate in off-grid conditions. As such, when Eskom goes down, most solar systems do, too.

However, this does not mean that large buildings with solar PV systems do not have options for load shedding. With careful engineering, It is possible to form one’s own “microgrid”, by replicating a fake grid-tied scenario to “trick” the solar inverters into staying on. This requires the use of a generator or battery, and specialised control equipment.

In order to retrofit a grid-tied solar system to operate during load shedding, two essential steps need to be taken. Firstly, the system needs to be isolated from the grid to prevent any exporting of power that could affect the safety of maintenance personnel. Secondly, a voltage forming source is required, in order to provide a reference voltage and frequency to the solar inverter.

Therefore, to prevent a grid-tied solar PV system from going out during a power outage, the following is required:

  1. Hardware that can disconnect the main supply from the grid, effectively isolating the building/facility from the grid.
  2. A diesel generator or battery bank that can provide backup power for the entire facility and provide the necessary voltage and frequency reference to the solar inverters.

These two points require careful engineering and a proper control system to manage the change-over, the dispatching of generators/batteries, and synchronisation of the solar inverters. It also has to oversee resynchronisation to the grid once the grid is available again. This can be automated and should not need any human input. Further, the system would need to be sized correctly in order not to trip under various loading scenarios.

With these two mechanisms in place, there would be a short down-time after an unexpected grid outage, due to the system having to switch itself on and switch to off-grid mode. Once switched over, however, the solar powered electricity which is being generated can be distributed throughout the building.

In order to avoid an outage entirely, it is possible to either isolate from the grid before an expected outage, or have an uninterruptible power supply (UPS) capable of providing continuous, uninterrupted power during an outage.

solar could help Africa's economy to grow

Option 3: Going off-grid: Using solar PV, batteries and Generators to go off-grid

Taking a commercial building off the grid entirely is another, although slightly pricier, option. Solar PV systems, when combined with energy storage, can store excess solar power produced during the day and distribute this later when needed. Solar PV is now one of the cheapest forms of energy, and its distributed nature means it’s perfect for use at source, where it is needed.

However, the costs of batteries and the sophisticated engineering of microgrid systems needs to be evaluated against the building’s requirements. Perhaps, a commercial or retail building operator does not mind paying a premium if that means consistent, clean power. (Microgrids also have particular relevance to supplying power in weak-grid scenarios – such as the one in Cedar Mill Mall which supplements the grid’s 250 kVA with an additional 250 kVA of power).

If your commercial or industrial building is currently using its diesel generators around 30% of the time, the business case for a solar PV and battery combined microgrid will likely look feasible. In a typical stage 4 load shedding scenario, power cuts generally occur for around 7 hours per day. Given the assumption that the energy load in the building is similar throughout the day and that diesel generators are being used to supply power consistently when the grid goes down, this would equate to around 30% of the total electricity consumption – making it a worthwhile investigation.

Whether it is a backup generator, installing a solar PV system with a backup generator or battery, or going entirely off-grid, there are options for commercial and industrial buildings in South Africa to prevent the damage that load shedding can do to business.

Cedar Mill Mall goes solar
Cedar Mill Mall in Clanwilliam is an islandable on-grid microgrid

A reflection on South Africa’s energy landscape in 2018

South Africa’s renewable energy sector received a new lease on life in 2018, after years of uncertainty and lack of movement.

With the Ramaphosa government signing nearly R56 billion worth in contracts with 27 independent renewable energy producers during 2018, the way forward, notwithstanding legislative and business challenges, is looking much brighter.

Significant progress has been made in the private sector in adopting renewable energy as a viable and consistent energy supply, often beating the costs of Eskom-supplied power.

We believe that more businesses will make use of renewable energy sources either to supplement their power, or for their primary electricity supply, as batteries and solar PV costs continue to fall.

Robben Island is saving millions of rands on its electricity bill though its microgrid. Earlier this year, Cedar Mill Mall in Clanwilliam opened its doors after Eskom told the developers it could not provide the power needed to supply the large building. These project show that despite inertia and a struggling economy, South African business can still benefit from renewable energy.

Uptake is particularly impressive in the retail sector, with malls catching on to the value of solar to produce low cost power during their busiest hours of operations. Ilse Swanepoel, Head of Utilities at Redefine Properties, whose solar PV fleet produces about 35 754 600 kWh per annum, stated “Solar is no longer niche and is a well-entrenched renewable energy source underpinning the achievement of green-building goals. Demand has grown in recent years, with many large blue chip tenants prioritising their own sustainability efforts, expecting the developer to dovetail and help achieve their objectives.”

This is encouraging. However, uptake in renewable energy should not just be supported by the private sector. For the economy to benefit from renewable energy’s reduced costs, the contracts signed by the government with the 27 independent renewable energy producers must translate into action that is sustainable, consistent and measurable.

Independent Power Producers (IPPs) have reportedly created 35 702 jobs and have spent R766 million on education, health, social welfare and enterprise development, according to figures provided by the ministry.

I’m optimistic about the renewable energy sector, given the government’s willingness in 2018 to acknowledge and engage with alternative energy suppliers, which were on hold for several years. REIPPP’s Round 5 is crucial in terms of accelerating the government’s transformation plan as it is set to bring about higher levels of transformation, localisation and community upliftment requirements.

In addition to this, the successful implementation of the Small IPP programme, aimed at smaller scale projects with a focus on SMMEs, high black ownership and local supply chains is exactly what the renewable sector needs. Going forward, we will need to work closer with all role-players as we better understand the sector and its ability to grow and develop South Africa.


Solar will be a boost for SA's economy

One of the most significant documents is the government’s draft Integrated Resource Plan (IRP), which outlines the way for South Africa to meet its growing national electricity demands by 2030.

The IRP was released for public comment in August. The construction industry (with its high electricity costs it incurs) has already welcomed the IRP, with some saying it could revive the industry. It has also been praised for its proposed increased allocation to renewable energy and the phasing out of coal and the pursuit of the ‘least cost option’ which rules out nuclear at least until 2030.

However, the IRP still lacks in clarity and allocation for embedded generation – which is one of the fastest growing energy sources and key to reducing corporate energy costs. A future-facing IRP takes into account not only the cheapest form of energy, but also the changes in the energy environmental happening globally. Coal-based, heavily centralised energy systems are fast becoming redundant with the introduction of smarter technology.

South Africa is no exception in this picture, with state utility Eskom plagued with difficulties in 2018. Still, Nersa’s (National Energy Regulator of South Africa) announcement giving Eskom the go-ahead to recover R32.7 billion (already approved as part of its adjudication of three separate Regulatory Clearing Accounts), will result in further tariff increases.

Embattled state utility Eskom

This will encourage businesses to look at alternative, consistent and cheaper forms of electricity – resulting in less income for Eskom and municipalities that rely on selling power through their grid.

Nersa continues to agree to Eskom’s requests for increasing tariffs. The embattled parastatal has again asked the regulator to push up tariffs – this time a 15% tariff increase per year over three years – this is on top of a 4.41% price increase Nersa has already granted Eskom. This proves to be one of the many reasons why a balanced energy mix should be put in place.

Another piece of legislation crucial to the sector is the so-called Carbon Tax (revised Draft Regulation on the Carbon offset), which Treasury published on 12 November for a second round of public comment.

Small and medium-scale renewable energy projects with a generating capacity of up to 50MW have been listed by Treasury as eligible for carbon offsets, but Nersa’s regulations might hinder national uptake.

Renewable energy trading, embedded generation and renewable IPPs needs to be supported by South Africans. Renewable energy solutions have the potential to jumpstart our economy; legislation is a step in the right direction. It will be interesting to see how the energy sector will develop in 2019.

solar could help Africa's economy to grow

SOLA’s Robben Island Project wins SANEA Project of the Year Award

SOLA Future Energy has won SANEA’s Energy Project of the Year Award. The award, which recognises an energy project that has brought significant recognition internationally to South Africa’s energy environment, was given to SOLA for their design and build of Robben Island’s Microgrid – a project funded by the Department of Tourism.

The award was given based on the project meeting a stringent set of criteria, including:

  • Leadership
  • Innovation
  • Initiative
  • Role model
  • Visionary qualities
  • International recognition
  • Contribution has had impact in South Africa

The Microgrid has assisted Robben Island, historically a grim landmark of isolation and oppression, to evolve into a space for critical dialogue, remembrance, education, tourism and conservation.

The installation of a state-of-the-art microgrid on Robben Island is the largest combined solar and lithium-ion storage facility in South Africa. The Department of Tourism had set aside funding for a microgrid project with solar photovoltaic systems (PV) to improve both the island’s image and function. SOLA Future Energy was awarded the contract to design and install a PV farm comprising nearly two thousand high-efficiency modules that would generate in excess of 666 kWp.

The Robben Island Solar project is a prime example of a technologically innovative and sustainable initiative.

Since adopting a green energy system, the island has already produced 650 000 kWh of solar energy – an average of 3250 kwh per day – which has significantly reduced its reliance on traditional diesel generators, a noisy and expensive feature of the old system.

In the past, diesel had to be transported by ship from the mainland, primarily to desalinate the island’s water supply. The cost of purchasing and transporting the diesel formed a substantial portion of the island’s operating budget. From a financial perspective, the solar plant is estimated to save the island over R6 000 000 in energy costs each year. The initial cost of installing the solar plant is likely to be paid off within four years. The snowball effect of the reduced spend on fuel is, at this stage, difficult to quantify. However, the savings could be used to upgrade existing infrastructure and create jobs on the island.

Over and above the financial considerations, the noise and dust emanating from these generators were not creating a tourist-friendly environment. In terms of carbon emissions, the solar farm is expected to reduce the CO2 emissions of the island by 860 Tons per annum.

Mmekutmfon Essien, Senior Project Manager at SOLA Future Energy, receives award from the Chairperson of SANEA

Mmekutmfon Essien, Senior Project Manager at SOLA Future Energy, receives award from the Chairperson of SANEA