Between January and June this year, wind and solar photovoltaic (PV) power plants contributed 2% of the 114.1 TWh of electricity sent to the national grid, a material scale-up from the position of previous years.
Bischof-Niemz says while the contribution may still seem small it is in fact impressive, particularly in light of the notoriously slow evolution of energy systems. “Energy systems have very long lifetimes, we are talking decades, up to centuries,” Bischof-Niemz says, noting that coal-fired power stations produced 99.9 TWh during the period. The rise in the contribution of renewables has been underpinned by government’s internationally acclaimed Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).
Following four REIPPPP bid windows around 6 300 MW of renewables capacity has been procured since 2011, of which 1 800 MW was operational during the January to June period. “South Africa has managed to introduce 2% of its entire electricity demand from renewabl s – that is a very steep ramp-up. If you compare the nearly 1% coming from solar PV, for instance, we have already surpassed the relative performance of the US, where the share of solar PV in the entire American electricity system is currently 0.5%.” Bischof-Niemz says the introduction of renewables has also had positive financial spin-offs. A CSIR study calculates that South Africa’s wind and solar PV projects generated nearly R4-billion more in net financial benefits during the first half of 2015. Cumulative savings of R8.2-billion during the period were partially offset by the tariff payments to renewables independent power producers (IPPs) of R4.3-billion. The model shows that a total of R3.6-billion of the savings have been derived from the replacement of diesel and coal fuel costs, with a further R4.6-billion in benefits arising as a result of the wind and solar power plants ensuring the avoidance of 203 hours of ‘unserved energy’. The study has also found that during 15 days from January to June 2015 the contribution from solar and wind either prevented or delayed load-shedding, or reduced its severity. During the period, South Africa experienced more than 80 days of rotational power cuts. The net financial benefit ascribed to the renewables projects during the period has also arisen notwithstanding the fact that tariffs from the first two bid windows (those plant currently operating) are substantially higher than what has been achieved in subsequent bidding rounds.
“The new wind and solar PV projects will be substantially cheaper than the projects that are already online,” Bischof-Niemz notes, adding that the projects of these two technologies have also already quantifiably changed the shape of the residual load, with base-load demand falling 400 MW over the period from August 2014 to July 2015. Therefore, as renewables ramp up further, it will be important for policymakers to find ways of facilitating the introduction of “flexible power generators”. “In addition to that, we should try to find a way to bring reserves and balancing power into some form of a procurement programme, which would help as the penetration of fluctuating renewables rises,” he argues. But the IPP Office, which has been successful in procuring utility-scale renewables, should also continue with the renewables procurement, which is in a “steady state” and is beginning to tap South Africa’s “impressive” solar and wind resources. “What we need in addition is a standard-offer-type approach for small and medium-sized power generators, including rooftop solar PV, or individual MW-class wind turbines on a farm, or 500 kW biogas plants.” Bischof-Niemz believes the standard-offer tariff can be derived using prices arrived at through the REIPPPP process, which could give comfort to policymakers that they are not paying over the odds to the smaller generators. He also believes that, with the introduction of the Ingula pumped-storage scheme in the coming few years, South Africa will be able to aggressively deploy more wind and solar for another decade before it faces serious storage problems. The REIPPPP is one of the fastest growing renewable energy programme’s in the world and South Africa aims to introduce 17 000 MW of renewables by 2030. The 999 MW Ingula pumped-storage scheme, which can effectively store energy for release during peak-demand periods, is expected to be introduced through three units between April and August 2016. “There are many ways to make the electricity system more flexible, including dispatchable demand. Therefore, we don’t need to deploy large-scale battery resources now. We can wait ten years until they are cheaper and allow others to pay the school fees. The business case for batteries today from a system perspective lies in the provision of balancing power and other ancillary services,” Bischof-Niemz concludes.