Posted in: Frequently Asked Questions

Solar for mines

How solar for mines helps to reduce operational costs and achieve a lower carbon footprint

Reliance on third-party infrastructure a significant risk for mines

The outlook for the mining industry in South Africa was a mixed bag in 2018 with bulk commodity prices continuing to rise from their lull at the beginning of 2016, while precious metals continued to struggle. Cost increases have put the mining industry under significant pressure and although price plays a crucial role in profitability, there are large fixed-cost elements associated with mining. Thus maintaining and ensuring optimum production levels plays a significant role in achieving profitability. 

This is why reliance on over-stretched third-party electricity suppliers such as Eskom can compromise profitability. In PwC’s annual publication highlighting trends in the South African mining industry it was reported that one of the significant subcategories driving risk is reliance on third party infrastructure with the cost and availability of electricity and water still a concern.

Mining facilities that typically rely on diesel electricity can use a solar microgrid to reduce the overall cost of energy, increase energy resiliency, thus ensuring control of their energy and power requirements. SOLA’s energy storage services department has considerable experience in combining battery storage solutions and existing generators in microgrid systems ensuring a continuous, uninterrupted electricity supply which is integrated with all other power sources.

Namibia and Botswana considering a 20-year, 4.5 GW solar push

‘The market for electricity produced by the mega-solar projects in Botswana and Namibia includes 12 other countries in the region that could be connected via new and/or upgraded transmission infrastructure,’ – WEF

The World Economic Forum’s (WEF) Global Future Council on Energy, has revealed that the governments of Botswana and Namibia are planning to develop 5 GW of solar capacity over the next two decades. Namibia and Botswana are considered perfect candidates for solar owing to their high solar radiation, strong legal and regulatory environments, suitable land availability and potential to host a low-cost, efficient electricity market to meet rising demand in the region. It has been suggested that this ambitious project, if completed, could lead to Namibia and Botswana exporting power to South Africa.

Botswana, a founding partner in a responsible mining initiative

Reducing carbon emissions is part of a global trend in the mining industry. Bloomberg reported last month that an explosive demand for renewable energy is expected to drive a global rush of exploitation, thus Botswana, the US, Australia and Peru are founding partners in an initiative to encourage responsible mining of rare earths and other minerals used in renewable energy projects such as solar panels, wind turbines and car batteries. 

Botswana’s mining industry contributes a third to the country’s GDP and 50% of tax earnings, and although the last quarter has seen a dip, economic growth is projected to pick up to 4.6% in 2020, supported by ongoing structural reforms aimed at diversifying the economy. It is perfectly primed to implement solar energy storage for mines owing to high solar radiation, the remote location of its mining facilities, weak grid supply and reliance on diesel.

Projected economic growth in Namibia in 2020

The IMF reports that Namibia’s economy will return to growth in 2020 after contracting for three straight years, though a failure to implement structural reforms could contribute to sluggish growth. Namibia has the second highest solar irradiation levels in the world, thus making solar energy storage for mines an appealing option.

No longer a question of if, but when

‘Industries that aren’t moving towards zero-carbon emissions will be punished by investors and go bankrupt’

Industries that aren’t moving towards zero-carbon emissions will be punished by investors and go bankrupt, warned the governor of the Bank of England, Mark Carney, last week. Thus renewable and storage technologies present the perfect solution by reducing energy costs while improving power quality and lowering carbon emissions.

The climate crisis will have a real financial effect on all major industries. Last Tuesday Carney told large corporations that they had two years to agree to rules for reporting climate risks before global regulators devised their own and made them compulsory.

Energy autonomy or supplementing grid supplied energy with embedded energy generation are both solutions to optimising production costs and reducing carbon footprint. Solar PV is both a cost-effective and decentralised form of energy, making it perfect for mines and other large scale energy-producers choosing to supplement their supply.

 Off-grid solar provides the ideal energy storage solution for mines. Remote locations, weak grid supply and reliance on diesel provide the optimal business case for solar PV microgrid. To test if your mining facility is suited to making the switch to off-grid make use of SOLA’s user-friendly mining tool.

Is solar energy suitable for my business?

You may have heard of solar PV – perhaps you even know other businesses that are using it. However, you might be wondering if solar PV is relevant for your business. It is worth considering that various factors affect the overall costs and tariffs of solar PV systems. 

Is solar PV right for my business?

At the outset, the best way to determine if your business could benefit from solar PV is by asking a few simple questions:

  1. Are you based in an area with good irradiation (solar resource)?
  2. Do you have a good quality, spacious roof or available open land near to your business?
  3. Do you use the bulk of your energy during the day?
  4. Are your reliant on diesel generators to keep your operation running during power cuts or because of lack of grid access?

If you answered “yes” to any two of the above, solar PV is definitely worth considering for your business. The aspects mentioned above are explored in more detail below. 

1. Good solar irradiation

It goes without saying, but solar PV performs better under conditions with great solar irradiation. If you are based in Africa, you are lucky: Africa has some of the best solar irradiation in the world, so it is generally a no-brainer. However, there are a few factors that might influence the quality of irradiance, which could affect the overall PV system size and thus the cost.

  • Weather: Weather can influence the quality of the irradiance. Things like extreme heat and humidity can affect how well solar modules perform, making irradiance quality vary in different geographic locations.
  • Pollution: pollution in the form of smoke and gases or particles can lower irradiation; it can also collect on solar modules and reduce their efficacy. 
  • Shading: Factors such as large buildings, highways and trees can shade roof areas during the day, causing the solar PV to stop producing. If your solar PV engineering firm is reputable they should be able to carry out an extensive shading analysis. 

2.Roof space and quality

Rooftop solar PV is often the most cost-effective solution for Commercial and Industrial businesses. As such, the size of your business’s roof, including the type of roof and if it is structurally sound, is an important factor to consider when scoping out the feasibility of solar PV.

If your roof is not suitable for mounting solar panels, it is important to consider if there is land nearby that could house a ground-mounted solar PV solution. All of these factors can affect the cost, and therefore the feasibility, of solar for your business. 

3.Energy Demand and use

An essential factor to evaluating the efficacy of a solar PV system is energy demand and use. Two factors come into this: the business’s peak power (kVA) requirements, as well as its electricity use (kWh). If the business is a high energy consumer, especially if it runs 7 days a week, the costs of solar will likely be much cheaper. However if the business has large amounts of electricity usage at night, for example, it might make the cost of the system more expensive. 

4.Diesel generator usage

In Africa, many business operations rely on diesel generators in order to keep the power on, either due to weak or unreliable electricity grids, or because they have no access to the grid. In general, electricity generated by diesel is very expensive, making a solar PV microgrid, including batteries, a great way to save and cut back on this. 

Procuring solar: your options

If you are convinced that solar PV sounds like a good intervention, remember that the following options exist to procure solar PV for your business:

  • Buy solar energy directly – enter into a solar PPA in order to use solar PV electricity without any capital expenditure. The solar PV system belongs to SOLA, and you simply pay for the electricity that you use. The longer the term of the PPA, the lower the tariff over the system’s lifespan (20 years).
  • Build a solar PV system – purchase a solar PV system that your business will own, and simply pay for annual maintenance and upkeep. SOLA will design and construct the PV system for you, ensuring that it performs as predicted, and will maintain the system going forward.

Is solar feasible for my business?

If you spend over R100 000 (US$ 7000) on electricity per month, fill in some basic information in our Solar Feasibility Tool. We will evaluate the efficacy of solar for your business free of charge, and provide you with a few simple options to go forward, should you wish to proceed. 

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

Solar PPAs are an affordable way to access the benefits of solar electricity

5 FAQs about solar PPAs

In some of our previous posts, we’ve alluded to the benefits of a solar PPA: both as a way to provide more options for business owners wanting to go solar, and as a way of reducing costs in certain sectors. At this point, you may be convinced that solar finance is an affordable way to access green energy for your company, but you may have a few questions. In this blog, we explore the 5 most common questions about the most common form of solar finance, the solar power purchase agreement or PPA.

Why a PPA?

As we mentioned in the previous blog, a solar PPA usually enables an electricity consumer to utilise solar energy at a rate that is cheaper than the existing utility. In addition the ownership of the solar system remains with the PPA provider, and the user only pays for the electricity that they consume, rather than for the overall cost of the solar system – making it an affordable choice for several sectors. Below follow some of the most frequently asked questions about solar PPAs.

1) How long does a solar PPA last?

In fact, this question gets asked so often that we wrote an article about how long solar PPAs are already, and if you’d like a detailed answer to the question, have a look at that article. The summarised answer is, “it depends”. Whilst as a rule of thumb, the longer the PPA, the greater the  immediate cost-savings will apply, many businesses prefer to enter into a shorter PPA period for a higher tariff, after which time the system ownership is transferred to the energy user. It all depends on the requirements of the client, as well as the overall objectives of the project.

2) Do I have to own the building to enter into a solar PPA?

PPAs ideally take place between a building owner and an energy provider, since the construction and ongoing maintenance, as well as energy distribution throughout the building, will require the building owner’s input and buy-in. However, if the building owner agrees to make the rooftop available for the solar system and the agreement takes the building and end user into account, tenants may be able to enter into a PPA.

3) If it isn’t sunny, do I still pay?

Depending on the type of PPA agreement you enter into, you shouldn’t have to pay if the system is not generating energy (take into consideration though, that even on cloudy days solar systems generate a good amount of power). However, the opposite does apply: if it is very sunny and producing more than what the building is consuming, the client may be liable for a minimum payment for the energy that is wasted, should it not be used. That is why it is essential to ensure that the system is sized correctly.

4)What happens at the end of the PPA?

Depending on the type of agreement, the system may transfer over to the client who then will take ownership of the solar system. This could work well if the building owner wishes to take  ownership of the system after a period of time. However, there can also be “early exit” options, if the property owner is concerned that the building might be sold during the PPA term. Again, each situation is different, and when entering into a PPA it is best to check if the agreement contains provision to either buy the system, or to get the new building owner to assume the PPA, should the building be sold.

5)What is included in the PPA tariff?

Depending on the type of agreement you enter into, the tariff will include the costs of designing the system, procuring all necessary components, and constructing the system on the suitable rooftop or ground-mounted area so that the solar electricity is readily available for the client. The tariff also includes the costs of maintaining the system on an ongoing basis, such as cleaning and part replacement as needed. Typically, these combined costs will be similar, or less than utility based power when comparing on a per-kWh basis.

Are you interested in finding out more? Contact our solar finance department to learn more about our solar financing options.