Gas prices are at their lowest in 14 years. Many African countries are adopting gas as their primary power source as they seek industrialisation within environmental constraints. Global engineering firm Siemens is at the forefront of this African energy revolution.
In Egypt, Siemens has orders to supply three natural gas-fired combined cycle power plants, each with a capacity of 4 800 MW for a total combined capacity of 14 400 MW. It is part of an €8 billion wind and gas energy order that will boost Egypt’s power generation by 50%.
Algeria is expanding its capacity from 11 000 MW to 26 000 MW by 2022, and Siemens is supplying gas turbines for two power plants which will generate over 2 000 MW to power five million homes. In Nigeria, Siemens supplied and financed a 459 MW gas turbine power plant.
What this demonstrates is that a determined government can overcome electricity constraints very quickly with the support of private sector expertise and technology.
South Africa is no exception, and could have thousands of new megawatts through a gas to power programme that can be implemented in two to three years.
SA urgently needs new sources of reliable clean power. The McKinsey study (SA’s Big 5 Bold Priorities for Inclusive Growth) recommends that SA urgently pursue gas to fill the 6 to 10 GW electricity supply gap expected by 2025 when a series of old coal-fired power stations are decommissioned. It sees gas from imported or domestic sources powering gas turbines with a combined capacity of 11 000 MW by 2013.
The Department of Trade and Industry’s 2015 Industrial Policy Action Plan (IPAP) refers to the profound potential for transformative gas industrial policy. It recognises that SA must rely on imported gas in the short term, but notes that neighbouring Mozambique is likely to become the world’s third largest exporter of liquefied natural gas (LNG).
The Department of Energy says its gas to power programme will anchor the development of a gas industry, and its successful Independent Power Producer (IPP) programme is expanding to include gas. The IPP programme turned South Africa into a world leader in renewables in five years. Doing the same with gas would have an even wider impact on energy supply and industrial development.
The McKinsey consultancy says natural gas could unlock new industries that add R250 billion to GDP and create 300 000 jobs by 2030. Gas to power also directly addresses technological, financial and environmental considerations. New combined cycle gas power plants are highly efficient and produce less than half the carbon emissions of new coal plants. Gas to power produces 30% less CO2 emissions than the diesel or petrol equivalent.
Gas is also the most flexible power source. Because gas-fired power plants can be stopped quickly and restarted in just 30 minutes, they can follow daily demand requirements and compensate for the variability of renewables. It is the ideal technology for an economy like South Africa, which is using a steadily growing share of renewables to meet its energy needs.
The emerging gas sector in SA has enormous potential for the creation of skilled jobs, training opportunities and foreign direct investment. Localisation also creates jobs in secondary industries, and contributes to socio-economic development.
Siemens is the ideal partner for future gas to power projects in SA. Its fleet of gas turbines boast tens of millions of operating hours worldwide with reliability of over 99%.
* For more information, visit www.siemens.co.za/ingenuityforlife