The CSIR has just released its latest report with calculations on the increasing savings these technologies are achieving. Collectively wind energy and solar power (photovoltaic) saved ZAR 4 billion from January to June this year. Wind energy produced net savings of ZAR 1.8 billion and was also cash positive for Eskom by ZAR 300 million.
The report is a follow up of the original study which was published in January this year and covered 2014. The figure for net savings attributed to renewables then was ZAR 800 million over 12 months. The latest figures demonstrate clearly that the benefits renewables bring to South Africa are increasing all the time as more
developments connect to the grid – now bringing 10 times more financial benefit than last year.
The benefits of renewables for the electricity market are calculated in two ways: Firstly, diesel and coal fuel cost savings which total ZAR 3.6 billion created by the 2.0 terrawatt-hours (TWh) of solar and wind energy that replaced what would otherwise have been fossil fuel-generated power. Secondly the saving to the economy through avoiding ‘unserved energy’ (load shedding). This totals 203 hours in which consumers’ energy would have been curtailed had wind and solar energy not been providing power to the grid. These macroeconomic benefits are calculated at ZAR 4.6 billion.
These savings more than offset the tariff costs associated with wind and solar projects that are providing power to the grid which reached ZAR 4.3 billion. All the above result in a net benefit of ZAR 4 billion brought to the electricity market.
SAWEA CEO Johan van den Berg describes the findings as “more good news” for the industry: “The fact that we can now show the dramatic increase in the benefits that wind energy bring to the grid adds to the increasingly widespread view within government, industry and among consumers that renewables are the answer to our country’s energy problems. When we add the approximately ZAR 16 billion that these wind, solar, hydro and biomass projects will invest into enterprise development and socio-economic development for communities close to projects, we have a winning formula that is being recognised and admired globally.”
Dr Tobias Bischof-Niemz, who heads up the CSIR’s Energy Centre, explains: “The study was based on actual hourly production data for the different supply categories of the South African power system (e.g. coal, diesel, wind, PV). We’ve developed a methodology at the CSIR Energy Centre to determine whether at any given hour of the year, renewables have replaced coal or diesel generators, or whether they have even prevented so-called ‘unserved energy'”
The release of these figures represents an increasingly positive environment for renewable energy in South Africa this year. It follows a government announcement in May that an additional 6,300 MW of renewable energy would be procured, over and above the existing 5243 MW’s that have taken the REIPPPP process to its current status at the end of Round 4.
The cost of wind energy is now between 60-70 cents per kilowatt hour (KWh) with solar managing to get close to 80 cents. Wind energy is now close to 50% cheaper than the predicted costs of new build coal powered stations Medupi and Kusile.