Eskom can put SA solar power on the map

RALPH BEROLD

Published: 2009/10/07 06:37:15 AM in Business Day

LAST month, the Development Bank of Southern Africa, the World Wildlife Fund and the Centre for Renewable and Sustainable Energy Studies of Stellenbosch University participated in and hosted a workshop on concentrated solar power (CSP), a form of renewable power generation proven in the US and Spain.

It has huge potential in sun-rich Africa. Desertec is one such project planned for north Africa to supply renewable power to the European Union. CSP could provide up to 25% of total global electricity needs. It is cost competitive and can provide a base- load alternative to new coal or nuclear generation without rising fuel costs, carbon emissions or nuclear waste.

Industry expert Louis van Heerden explained at the meeting how CSP uses the sun’s rays to heat a fluid (normally water or molten salt) driving a steam turbine to create electricity. One form is a parabolic trough, or Fresnel mirror arrangement, that focuses solar radiation on a pipe carrying the fluid, with or without a glass vacuum.

CSP is one of the technologies subsidised under the National Energy Regulator of SA’s new renewable feed- in tariff. A similar tariff worked well in Germany and Spain. At a generous R2,10 per kWh of solar power produced, the tariff makes the sector attractive to new developers and investors, including Spanish-based Abengoa Solar and Google-funded eSolar, as well as local banks and entrepreneurs.

A major injection of private investment into CSP would assist the government in meeting its target of procuring 10000 GWhs of renewable energy by 2013. It would go a long way to diversifying the energy mix away from carbon-emitting fossil fuels, so that we can meet our climate change commitments, as laid out in the Cabinet-approved long-term mitigation scenarios.

The fund’s Saliem Fakir argued that renewable energy offers the promise of much-needed job creation. CSP components such as low-iron glass, steel, cement and gearboxes can be bought locally, which would stimulate local businesses and create employment to counter job losses in the faltering textile and motor industries. CSP technology offers export opportunities to the continent and beyond, which could be assisted through relaxed tariffs, development loans, renewable grants and the UN’s clean development mechanism.

A competitive solar CSP (and photovoltaic) solar industry is feasible in the medium term, however, only if action is taken now. Higher allocations for research and development are necessary, as are a pipeline of appropriately skilled graduates and technology transfer and partnerships with world leaders in the field.

In the short term, it is essential to open the way for the renewable power industry. This means finalising a bankable power purchase agreement with independent power producers and starting to buy power from them that can be fed into the grid.

Eskom has a major role to play in facilitating these connections and adapting its architecture for distributed producers. The role of buyer would best be served by an independent system operator, freeing Eskom to be one of many sellers in an open and regulated market. A successful model for the region is the Nord power pool in Scandinavia.

With its own funding model clarified in a broader market environment, Eskom must play a strategic role in SA’s future energy mix. It needs to continue providing coal power to the grid while improving efficiencies and reducing emissions to support large industrial customers.

Due to its financial woes, Eskom has put its planned 100MW CSP plant for Upington on hold. To show SA is serious about climate change, and to signal a real shift to renewable sources, the estimated R2bn-R3bn of public finance for this project must be found. The flagship plant would stimulate local manufacturing, and break the ground for a necessarily ambitious renewable energy industrial policy, something like the Motor Industry Development Plan. A 100MW solar tower plant with storage capacity would be one of the largest of its kind in the world, and definitely put SA’s solar industry on the map.

n Berold is an independent energy analyst.