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Gosling delighted at reporting award

CAPE Times environmental writer Melanie Gosling is “delighted” at receiving an award by the South African Wind Energy Association (Samwea) for the best journalistic coverage of wind energy.

“Throughout the last decade, Melanie has reported on environmental matters in a highly informed and professional manner.

“In the past few years, she has taken care to understand energy-related issues and has reported on the development of the wind industry in a contextualised, responsible and balanced manner,” Samwea chief executive Johan van den Berg said.

“As South Africa enters an era where wind will be part of both our physical and political landscapes, her work on a complex topic evoking strong emotions from different quarters has set an example to her colleagues.”

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Gosling, who has been a reporter for the Cape Time for more than 20 years said she was delighted with the award. – Staff Writer

Special zone for Atlantis on the cards

A LARGE portion of land in Atlantis could be declared a special economic zone, focused specifically on the green industries sector, Trade and Industry Minister Rob Davies said on Wednesday.

Special economic zones for the green manufacturing sector are still to be promulgated, but Mr Davies said an advisory board, to make recommendations on their establishment, was likely to be appointed "within the next month".

Atlantis was chosen because of its large tracts of unused industrial land and because of its proximity to the Saldanha Bay Industrial Development Zone.

Atlantis has suffered from significant job losses and green manufacturing is seen a key job driver.

Companies working in special economic zones qualify for a range of incentives, such as a 15% corporate tax rate, a building tax allowance, an employment tax incentive, value added tax exemption and a duty free provision.

"In the next year we will see some decisions being taken," Mr Davies said. "We have to go through the processes, we have to weigh up the feasibility studies … we work with provinces, and all the provinces identified potential special economic zones."

On Wednesday, Mr Davies officially opened the R300m Gestamp Renewable Industries wind tower manufacturing plant in Atlantis, which is expected to create 200 jobs. Chinese electronics company Hisense opened a factory in Atlantis last year.

Cape Town mayor Patricia de Lille said the Gestamp plant was the first major investment the city had attracted through its pilot investment incentive scheme launched last year. "The hard financial incentives that we make available include the exemption of application fees for land and building plans and waiving development facilitation fees. We write off debt when businesses meet employment targets, enabling job creation through direct investments," Ms de Lille said.

The Western Cape has attracted about R20bn in actual and planned investment in renewable energy in the past five years, and more than R30bn in overall foreign direct investment in the past three years.

R300m Atlantis wind-turbine tower factory offers light at the end of the tunnel

With South Africa currently in the grip of debilitating rolling black-outs and load shedding due to the Eskom power grid being stretched to capacity, and exacerbated by a loss of capacity at its Majuba power station in Mpumalanga, it comes as a ray of light that GRI – Renewable Industries officially announced the opening of their new R300m wind turbine tower production facility in Atlantis, Cape Town.

South Africa's steady economic growth and focus on industrialisation, together with its mass electrification program has seen a steep increase in the demand for electricity, to the point where South Africa’s energy demand is expected to double by 2030. Adequate provision for this massive demand has been hampered by various factors, suffice to say that the rapid search for alternative energy sources is a priority. The government is encouraging the search for new sustainable energy practices with various tax incentives, helping businesses and local government to actively seek tangible and immediate solutions to this growing problem. The government is also looking to support sustainable green energy initiatives on a national scale through a diverse range of clean-energy options as envisaged in an Integrated Resource Plan. In terms of this plan, which is a 20-year projection on electricity demand and production, about 42% of electricity generated must come from renewable resources.

The R300m investment from Spanish corporate, GRI Renewable Industries offers South Africa a giant leap forward in the provision of renewable energy alternatives with the facility capable of producing 150 wind towers a year.

Javier Imaz, CEO of GRI, comments, “Our investment in this new state of the art wind turbine tower production facility clearly demonstrates our long-term commitment to South Africa and also positions GRI Wind as open for business and willing to partner local enterprises to develop sustainable wind energy facilities in South Africa.”

The 12,000m² factory, situated in the Green Technology Industrial Park in Atlantis, about 40km from Cape Town, will help propel South Africa into the renewable energy market, with more investment planned for the future. The state of the art facility integrates the use of energy saving technologies designed to maximise the benefits of natural lighting and ventilation. The 350m long factory has custom-designed storage space, allowing each completed tower section to be stored on site. Each section can weigh up to 90 tons, and measure 38m in length, and five metres in diameter. In addition there is permanently installed logistic machinery to move and load the completed sections. 

The company hopes to reach full production volume in 18 months, and in the process will develop a highly skilled and motivated workforce, contributing towards sustainable and responsible power generation. Atlantis has always suffered from high unemployment rates, and this project will not only create 200 permanent jobs, but new skills will be taught that currently do not exist in this country. Local and overseas experts will invest in identifying and training the new labour force and up-skilling them to be able to provide the necessary service to perform their jobs to the highest standards, leading to much needed social upliftment within this local community. This is the first investment that the City of Cape Town has attracted through its pilot Investment Incentive Scheme in Atlantis, and is testament to the City’s emphasis on partnerships to make progress possible.

A recently completed wind power project at Noblesfontein located near Victoria West in the Northern Cape has a capacity of approximately 74MW achieved through the installation of 41 turbines. This plant forms part of the Renewable Energy Independent Power Producer Procurement programme managed by the Department of Energy and has Purchase Power Agreements with Eskom for the next twenty years of operation.

Mr Imaz concludes, “Not only will this investment offer a realistic solution to the current fragile power situation, but we will be deploying and sharing our know-how with the local market and at the same time generating additional job creation opportunities. We see a bright future for South African-developed renewable energy, both locally and also in Africa, not just as users but suppliers as well."

South Africa’s energy system on knife-edge – NPC commissioner

State-owned power utility Eskom is in very real danger of a ratings downgrade, with the energy system on knife-edge at the moment, warns Professor Anton Eberhard, a member of the National Planning Commission (NPC).

South Africa has been plunged into an energy crisis, which Eberhard says is the worst in 40 years. Outages have been commonplace despite peak power demand falling below 2007 levels and actual electricity use far below forecasts.

Maintenance problems and four-year delays in the construction of Medupi and Kusile, in Limpopo and Mpumalanga respectively, are putting immense strain on the system.

“In the past three years, we’ve lost the equivalent of an entire coal[-fired] power station through deteriorating plant availability. Of 87 coal-generating units, 32 need major surgery and three are in a critical condition,” Eberhard told delegates at the WINDaba, in Cape Town, on Tuesday.

Eskom has conceded in Parliament that it cannot guarantee electricity supply security for at least another five years.

Eberhard stressed that clarity on South Africa’s broader energy plan was needed.

Outlining the NPC’s Energy Vision and Plan for South Africa, he suggested that serious and urgent action was needed, particularly on the gas master plan, adding that the economics of the new Mozambique gas pipeline needed to be explored, as well as deep offshore drilling.

Eberhard said the contribution of renewable energy was very important, particularly as solar prices had fallen 68% within the last three years, with a 42% drop in the price of wind energy.

The WINDaba has brought together several hundred people who are keen to strengthen their stake in the wind energy industry.

The prospect of nuclear power currently appeared far more debatable, particularly if demand for electricity in the long run was lower owing to slower economic growth. Eskom’s power systems economist, Keith Bowen, noted that projections had been lowered.

“If demand is lower, then we only need nuclear in 2037. It calls into question why all the focus on nuclear at this stage?”

“If electricity demand will be lower and nuclear prices are above $6 500/kW, then rather go for gas and other options,” suggested Eberhard, mentioning that the latest nuclear plant in the UK cost $8 150/kW.

Acting CE of Business Unity South Africa Cas Coovadia said he was concerned both about the maintenance of power stations, particularly Majuba, in Mpumalanga, which was only 13 years old, as well as confusing communication around the power outages being experienced at present.

“The silo collapse does point to poor engineering and maintenance. We need to look at maintenance and where the stations are being built,” Coovadia expressed.

He said mixed messages from City Power in Johannesburg and Eskom about outages this week, following the collapse of the Majuba silo, were creating havoc for the business community.

Independent power producer Globeleq GM Mark Pickering pointed out that he was worried that government’s renewable energy programme was not properly institutionalised.

“It can be turned off with the stroke of a pen,” he stated.

Eberhard agreed. “We need to embed this in an institutional system

Wind Farms to Generate over $633M in Revenue for South Africa

Delegates on day one of the South African Wind Energy Association heard that wind energy is now set to make a contribution of more than ZAR 7 Billion to communities and socio-economic development over the next 20 years in South Africa. With five wind farms in full operation, 22 large-scale wind farms currently under construction and another 700 MW expected to be awarded imminently, the total capacity amounts to 2684MW set to be installed. Each of these developments has committed significant financial investment to nearby communities.

“Utility scale wind energy is already boosting economic development in South Africa. Industry and government are committed to ensuring that these benefits are realized by small business and local communities across the country,” explains Dipolelo Elford, Chairperson of the South African Wind Energy Association (SAWEA).

As per the design of the Renewable Energy Independent Power Producers Procurement Program (REIPPPP), each utility-scale wind farm invests a percentage of its revenue towards socio-economic development (and in some cases enterprise development) in the areas surrounding the farm. Additionally, shares in the wind farm project company are allocated to an entity representing local residents within a 50km radius.

The revenue percentage and dividends from the shares in the farm will benefit the local economies and residents over the full lifetime of the wind farms: 20 years. The amounts invested will be substantial – more than ZAR 7 Billion based just on current allocations, with more large scale development expected through to 2030. This figure compares favorably to that of direct investments made into communities in more mature wind energy markets in Europe and the United States.

SAWEA considers delivery on its socio economic compact with government as core to its mandate. ‘Power2thePeople: changing lives through wind energy’ is the theme for its annual conference Windaba, which will be held in Cape Town from 3-5 November. Ongoing discussions and experience sharing will take place on the subject of working with communities and how funds can be most effectively invested. A workshop running alongside Windaba, hosted by SAWEA’s Wind for Communities working group will focus entirely on SED and how the full potential of community benefits can be realized.

Post graduate students Sarah Stands and Holle Wlokas are researching the economic development commitments and practical outcomes of the REIPPPP and will be participating in both the conference and workshop to share their findings to date. Part of this research involves analyzing procurement documents and ongoing implementation of projects in relation to the effects on long-term local economic development and employment. Both women are also members of the South African Wind Energy Association’s ‘Wind for Communities’ working group, hosts to the SED workshop.

Direct, indirect and induced employment opportunities are created during all stages of the development, implementation and operations and maintenance (O&M) of the wind farms, yet only a fraction of direct jobs are accounted for in the REIPPPP. With the current awarded installed capacity and future IRP2010 allocation, a conservative figure of 77,700 cumulative jobs (person-years) may be created by 2030, 54,400 in the 20 year O&M period. This results in a minimum of 3,600 direct long-term and sustainable jobs, predominantly for semi-skilled and skilled individuals in local communities.

Wind energy to benefit communities in South Africa

Wind energy in South Africa is set to contribute more than R7-billion to communities and socioeconomic development over the next 20 years.

“Utility-scale wind energy is already boosting economic development in South Africa,” South African Wind Energy Association (Sawea) chairperson Dipolelo Elford told delegates at the WINDaba conference, in Cape Town.

He said government and industry were committed to ensuring that small business and local communities benefitted from wind farms.

In terms of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP), wind energy project developers were required to allocate between 2.5% and 40% of shareholding to legal entities representing local communities. The dividends need to be invested in local economic development projects and programmes.

But residents might have to be patient. Funds would be released once the wind farm started generating profits, which could take up to ten years, depending on the energy generated and the initial cost of development.

Wind energy had taken off in South Africa, with five wind farms in full operation and another 22 large-scale farms under construction. Another 700 MW was expected to be awarded soon. 

Elford said infrastructure in certain areas where wind farms had been set up had helped communities. “There are areas which used to be in darkness and now, for the first time, they have lights.”

Sawea believed the R7-billion figure, which was based on current allocations, compared favourably to that of direct investments made into communities in more mature wind energy markets in Europe and the US.

Elford noted that South Africa had rapidly advanced its wind power generation.

“In 2011, the first preferred bidders were announced. This time last year, the independent power producers had broken ground and turbines were popping up all over the place. Now we have five wind farms in full operation. We hope to get to a stage where wind is fully integrated into the electricity grid of the country.”

While the wind energy industry was not labour-intensive, Sawea estimated that investment in the industry would result in a minimum of 3 600 direct long-term and sustainable jobs, mainly for semiskilled and skilled people in local communities.

Thousands of jobs were expected to be created during the construction phase of the wind farms.

Meanwhile, there was still plenty of international interest in South Africa, Global Wind Energy Council (GWEC) secretary-general Steve Sawyer told delegates at WINDaba.

He commended South Africa’s power procurement system.

“Because of the success of Brazil and South Africa’s ‘auction’ system for wind power procurement, it’s now all the rage,” he told several hundred delegates, but added that delays in the REIPPPP were a concern.

Globally, China had the biggest annual market size for wind energy, with its share of the global market being 28.7%. The US, Germany, Spain and India made up the rest of the top five countries in terms of market share.

The GWEC believed Asia would surpass Europe by the end of this year in terms of total installed capacity.

After a sluggish 2013, Sawyer expected a much better industry performance for 2014.

Wind energy a pillar of Danish investment in South Africa

Danish companies are keen to set up a green hub on renewable energy in South Africa, with an eye on developing markets in Southern Africa, Danish Minister of Trade and Development Cooperation Morgens Jensen has told Engineering News Online.

He said he saw tremendous opportunity in South Africa, particularly in terms of wind energy, but that Danish companies needed to expand into Africa to make their investments worthwhile. 

“Danish companies are ready to invest, but they need the volumes and movement into Africa.”

Jensen was speaking on the sidelines of the yearly WINDaba summit in Cape Town, which has drawn investors, suppliers and developers, as well as a large contingent of Danish companies. They include Vestas, which is supplying and installing wind turbines for several wind power plants in South Africa, including Chaba, Waainek and Grassridge in the Eastern Cape, as well as Hopefield in the Western Cape.

Jensen commended the government’s Renewable Energy Independent Power Producer Procurement Programme, but emphasised that providing certainty that renewables would remain a high priority was all-important for investors. Grid connection was also key.  

Power utility Eskom’s financial difficulties have put grid connection under pressure, while the government has reduced its requirements for renewable energy by 10 000 MW by 2030.

Jensen encouraged South Africa to learn from Denmark’s experience in the renewables sector.

The Danish government funded the Wind Atlas in South Africa, which is helping industry and government identify excellent wind development zones. Ten 60-m-high wind masts have been installed at various sites across the country to measure wind.

Jensen also encouraged South Africa to learn important lessons from the current energy crisis it was facing.  

“Never let a good crisis go to waste…The 1973 energy crisis was a game-changer in Denmark. It underlined our need to diversify. Wind energy is affordable.  It compares very favourably to coal-power in terms of price – and the silos don’t crack,” he quipped.

Denmark has set itself a target to generate half of its energy requirements from wind energy by 2020. The long-term goal was to shift the entire energy system, including transport, to renewable energy by 2050.

Jensen also encouraged the South African government to be more flexible on granting visas for business purposes. He said he had discussed this with South Africa’s Trade and Industry Minister Dr Rob Davies, during an official visit this week.

The Danish Minister later told the WINDaba it was crucial to engage local communities and get public support for renewable energy. He said Denmark had managed to maintain a green energy mix, partly through regional power pools.

When renewables like wind are not performing optimally in Denmark, it’s able to import solar power from Spain and hydropower from Norway.

“This is how we control the mix between fluctuating sources.”

During the meeting with Davies, Jensen said his country planned to boost its overall trade with South Africa by 50%. According to Jensen, 27 000 Danish citizens visit South Africa every year.

Significant wind farm jobs benefit

WIND energy will contribute R7 billion over the next 20 years to the socio-economic development of communities living around South Africa’s wind farms, delegates to the Windaba conference in Cape Town heard yesterday.

Dipolelo Elford, chairwoman of the SA Wind Energy Association (Sawea), said, in addition, jobs would be created at all stages of the average two-year construction phase and during the wind farm’s 20-year lifespan.

Local residents living within a 50km radius of a wind farm would benefit from projects through a percentage of shareholding, a government requirement. Wind farm developers will allocate between 2.5 and 40 percent of shareholding to legal entities representing local communities. The money will be released once the wind farms begin to generate profit, which could take up to 10 years, depending on the amount of energy generated and the cost of development.

There are five South African large-scale wind farms in commercial operation, generating a total of 484MW, and 22 under construction. Another round of wind farms are due to be selected by the government through a fourth round of bidding by wind farm developers. This will add another 700MW of wind power.

Johan van den Berg, chief executive of Sawea, said wind could generate power at one fifth of the cost of Eskom’s open-cycle gas turbines. The diesel-run turbines, used by Eskom to keep the lights on when electricity demand is high, cost R10bn to run last year – R8bn above budget.

Van den Berg said South Africa had a lot of excess pumped-storage generating capacity, but did not have enough power to pump it. Wind power could be used to do this.

“You would be saving R5 by spending R1.”

Wolsley Barnard, acting director-general of the Department of Energy, said it was doubtful if the fourth round of bidding would be held on schedule on November 24. Companies bidding competitively to build wind farms are selected by the government on a range of criteria, cost being a major one.

Barnard said because Eskom was “in a tight situation”, the deadline might not be met, but bidding would happen “as soon after as possible”.

Eskom has to upgrade the grid to be able to connect the renewable energy power plants. In some cases it has been unable to do so and has had to pay renewable energy companies for power they were not generating.

Barnard said part of Eskom’s rescue package from the government was to be used to connect renewable energy power plants to the grid.

Asked about the updated Integrated Resource Plan (IRP), Barnard said there would be an overall reduction of 10 000MW across all generating sectors, including wind, in the IRP’s projections for 2030. This was because the demand forecast for 2030 had been recalculated and was lower than originally forecast.

The IRP, a 20-year electricity blueprint, was established in 2010. It is currently waiting approval by cabinet.

IN DEPTH: South African promise

South Africa is well on the way to becoming a significant wind-power market, with a cumulative capacity of more than 2.6GW expected in the next few years.

 

Wind could supply nearly 20% of global power by 2030 – report

Installed wind power capacity could swell by 530% to 2,000 gigawatts (GW) by 2030, supplying up to 19% of global electricity, a report from a trade association and Greenpeace said on Tuesday.

It said installed wind energy capacity totalled 318 GW at the end of last year worldwide and provided around 3% of global electricity supply. Capacity is set to grow by another 45 GW to 363 GW this year.

In some parts of the world, particularly in Europe, people have objected to wind power due to government subsidies which they claim have contributed towards rising energy bills.

But Steve Sawyer, chief executive of the Global Wind Energy Council (GWEC), said: "Wind power has become the least-cost option when adding new capacity to the grid in an increasing number of markets, and prices continue to fall."

The GWEC, which represents 1,500 wind power producers, looked at the future of the wind energy industry to 2020, 2030 and 2050 under three scenarios based on existing and future emissions reduction and renewable energy policies.

Based on International Energy Agency forecasts, it said cumulative installed wind energy capacity could reach 611 GW by 2020 and 964 GW by 2030.

Under the report's "moderate" scenario, based on existing renewable energy policies and assuming that emissions reductions agreed next year in Paris under a global climate deal will be modest, installed wind capacity could reach 712 GW by 2020, nearly 1 500 GW by 2030 and around 2 670 GW by mid-century.

That means wind energy could meet 7% and 8% of global electricity demand by 2020, 13% to 15% by 2030 and 17% and 20% by 2050.

Under the "advanced" scenario, based on more ambitious growth rates and assuming that a robust global climate deal is in place, installed capacity could reach 800 GW by 2020, nearly 2 000 GW by 2030 and over 4,000 by 2050.

That means wind energy could provide 8-9% of global electricity supply by 2020, 17-19% by 2030 and 26-31% by mid-century.

"Given the urgency to cut down CO2 emissions and continued reliance on imported fossil fuels, wind power's pivotal role in the world's future energy supply is assured," Sawyer said.

The report identified Brazil, Mexico and South Africa as areas for new growth in wind energy. Brazil is set to install nearly 4 GW this year alone, while Mexico should add around 2 GW a year for the next 10 years.