Monitoring Renewable Energy Performance of Power Plants
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MONITORING RENEWABLE ENERGY PERFORMANCE OF POWER PLANTS Progress in the first half of 2018 (Issue 12) October 2018 Prepared by: Dr A Gxasheka, Mr H Mokhonoana, Ms R Mokoena Tel: 012 401 4600 Email: [email protected] 1 Table of contents Glossary of terms ................................................................................................................ 3 Abbreviations ................................................................................................................... 4 1. Introduction .................................................................................................................. 5 2. Rationale and Scope of the Report .............................................................................. 7 3. Progress in terms of Installed Capacity of Renewable Energy .................................... 8 4. Energy Contribution of REI4P Projects ........................................................................ 9 Power system contribution ................................................................................... 9 Monthly energy production ................................................................................. 11 Hourly energy profiles of RE ............................................................................... 12 Average load factor for the first six months of 2018 ........................................... 14 5. Renewable Energy Power Plants Outside Department of Energy Procurement Programme ................................................................................................................ 14 6. Calculated Cost of Energy to Consumers .................................................................. 16 6.1 Cost trends of global renewable energy projects ................................................ 16 6.2 Prices of renewable energy in South Africa ........................................................ 18 7. Concluding Remarks .................................................................................................. 19 APPENDIX A: List of operational power plants under REI4P ........................................... 20 2 Glossary of terms Bid window Means any of the procurement phases under the Renewable Energy Independent Power Producer Procurement Programme of the Department of Energy. Energy Regulator Means the regulatory authority established as a juristic person in terms of Section 3 of the National Energy Regulator Act, 2004 (Act No. 40 of 2004). Government Means the Government of the Republic of South Africa, and any of its departments, agencies or other entities that it manages or controls. Gigawatt hour Energy unit in which electricity consumption is measured (1GWh = 1000MWh). Independent power producer (IPP) An IPP is defined as typically limited-liability, investor-owned enterprise that generates electricity either for bulk sale to an electric utility or for retail sale to industrial or other customers with certain conditions. Load factor Means the ratio of the power plant output over a period of time, to its potential output if it were possible for it to operate at full nameplate capacity continuously over the same period of time. Megawatt hour Energy unit in which electricity consumption is measured (1MWh = 1000kWh). Minister Means Minister of Energy Renewable energy (from the 2003 White Paper on Renewable Energy) Renewable energy harnesses naturally occurring non-depletable sources of energy, such as solar, wind, biomass, hydro, tidal, wave, ocean current and geothermal, to produce electricity, gaseous and liquid fuels, heat or a combination of these energy types. 3 Abbreviations BW Bid window COD Commercial operation date CSIR Council of Scientific and Industrial Research CSP Concentrated solar power DoE Department of Energy IPP Independent power producer IRP Integrated resource plan MW Megawatt MWh Megawatt hour GWh Gigawatt hour NERSA National Energy Regulator of South Africa OCGT Open cycle gas turbine PPA Purchase Power Agreement PV Photovoltaic RE Renewable energy REIPPPP (‘REI4P’) Renewable Energy Independent Power Producer Procurement Programme 4 1. Introduction The number of large-scale renewable energy (RE) power plants connected to the grid has increased significantly over the past years, contributing towards water saving and cleaner environment. Three RE Ministerial Determinations1 issued in recent past have ensured that the implementation of Integrated Resource Plan (IRP) 2010-2030 is realised. In the previous publication of this report, Issue 112, which is available online, detailed information of all procured Bid Windows (BWs) and licensed projects was covered extensively, hence it will not be repeated in this issue. Reports3,4,5 published in the recent past have praised the way in which the country has implemented RE power projects, from bidding stages of the Renewable Energy Independent Power Producer Procurement Programme (‘REI4P’), to the signing of power purchase agreements (PPAs). The delay of almost two years in signing PPAs of BW3.5 and BW4 projects has been resolved through negotiations between Government, Eskom and IPPs. The PPAs of 27 projects from BW3.5 and BW4 IPPs were signed on 4 April 2018. Furthermore, the negotiations yielded positive results in that some initial bid prices of IPP projects were negotiated downwards in a bid to provide affordability for consumers. Figure 1 shows proposed electricity generation mix plan in the Draft Integrated Resource Plan 2018 until the year 20306. By 2022, the draft plan intends to have additional capacity of 2 288MW for solar PV, while wind is expected to have additional capacity of 3 342MW. From 2026 till 2030, PV will have annual capacity additions of 1 000MW, while wind will add 1500MW in 2026 and then introduce 1600MW annually from 2027 to 2030. By 2030 it is envisaged that the combined new capacity additions of the above technologies will be 19 400MW. 1 RE Ministerial Determination of 11 August 2011, 3 725MW (includes 100MW for small projects) RE Ministerial Determination of 19 December 2012, 3 200MW RE Ministerial Determination of 18 August 2015, 6 300MW (includes 200MW for small projects) 2 NERSA Report, Monitoring Renewable Energy Performance of Power Plants (Issue 11), March 2018. Available Online: http://www.nersa.org.za/Admin/Document/Editor/file/Electricity/SustainableEnergy/Monitoring%20Ren ewable%20Performance%20of%20Power%20Plants%20- %20%20Tracking%20progress%20of%202017%20-%20Issue%2011%20(March%202018).pdf, Last accessed 15 August 2018. 3 Article published on Engineering News Online: 9th May 2016, http://www.engineeringnews.co.za/article/tallying-the-benefits-of-south-africas-renewable-energy- power-producers-procurement-programme-2016-05-09/rep_id:4136 4 T Bischof-Niemz: Financial benefits of renewables in South Africa in 2014. CSIR Energy Centre: Pretoria, 2015. 5 A Eberhard, J Kolker and J Leigland: South Africa’s renewable energy IPP procurement program: Success factors and lessons. World Bank: Washington, 2014 6 Proposed Integrated Resource Plan 2018, Page 41, Table 7. 5 There are also annual capacity additions of 200MW planned for embedded generation. It is expected that a large portion of the embedded generation capacity will be rooftop photovoltaic (PV). 78 344MW +30 526MW 47 818MW Figure 1: Energy mix of South Africa (Data sourced from Draft IRP 2018) Figure 2 shows the geographical distribution of the electricity sources in the country. Looking at the figure, the introduction of RE in the grid has changed the geographical distribution of generators, from being centralised in the north east in Mpumalanga, to other provinces such as the Northern Cape, Western Cape and Eastern Cape. This is important for the grid as it ensures that energy generated is consumed near the sources, thereby reducing transmission losses. For intermittent resources, it is important to have generators distributed in all areas to avoid localised weather patterns, such as cloud cover, which affect the production output of solar PV plants. 6 Figure 2: Geographical location of RE IPP projects in the Department of Energy’s procurement programme (Source: Eskom Transmission Development Plan 2018) 2. Rationale and Scope of the Report South Africa is still on a learning curve when it comes to grid connected large-scale renewable energy (RE) power plants. The introduction of RE requires planning around its impact as a variable resource and how best it can be used to supplement conventional baseload resources in matching load. Countries with high penetration of RE have studied its impact by using data that is collected from the distributed generators across the grid. This ensures that historical data collected is used for studying and updating country energy long-term plans. In terms of section 4 of the Electricity Regulation Act, 2006 (Act No. 4 of 2006) ('the Act'), NERSA has a mandate to “establish and manage monitoring and information systems and co-ordinate the integration thereof with other relevant information systems”. The REI4P power plants are required to submit reports on their monthly energy production, pursuant to section 15 of Grid Connection Code for Renewable Energy, version 2.8 of 2015. The report is intended to inform the industry, including electricity consumers, about the progress of RE in terms of supplying power to the grid. This issue of the monitoring report covers the update of installed capacity (MW), the energy production and analysis of the costs associated with energy produced by RE power, as this ultimately affects