Cape Town - South Africa’s fledgling renewable energy sector contributed R5.6 billion worth of benefits to the country last year, according to a study by the CSIR.
The study, which assessed the financial benefits of renewable energy last year, found that electricity generated by wind and solar power had saved R3.7bn that would otherwise have been spent on diesel and coal.
The two renewables replaced 2.2 terawatt hours of electricity that would have been generated by burning either diesel and coal.
There was a second saving of R1.6bn from what the researchers call “unserved energy” – the saving to the economy of avoiding power cuts to some consumers. At certain times, wind- and solar-generated electricity increased generating capacity on the grid and so avoided a certain amount of load shedding.
The researchers measured the cost of wind and solar-generated electricity, which independent power producers sold to Eskom. Tariffs Eskom paid to the independent power producers last year for wind and solar amounted to R4.5bn.
When this was subtracted from the savings in fuel costs and from the avoided power cuts, it left a net benefit to the country of R0.8bn.
Tobias Bischof-Niemz, head of the CSIR’s energy centre, said: “Our study shows that in 2014, renewable energy provided a net financial benefit to the country.
“Without these solar and wind projects, we would have spent a significant additional amount on diesel and energy would have had to be ‘unserved’ during about 120 additional hours.”
The study was based on actual hourly production data for coal, diesel, wind and solar.
The renewable energy power plants that generated power last year came from the first projects selected by the government in their independent-power producers programme, when tariffs for renewable energy were higher than today.
The renewable energy tariffs in round one were R2.08 a kilowatt hour.
Bischof-Niemz said the cost had since come down significantly.
“The cost per kilowatt hour of renewable energy for new projects is now well below R1 for solar photovoltaic, and between 60c and 80c for wind projects.
That will keep the net financial benefits of renewables positive, even in a future with a less constrained power system.”
The researchers developed a methodology at the CSIR to determine whether, at any given hour of the year, renewables had replaced coal or diesel generators, or whether they had prevented load shedding.
Bischof-Niemz said the real savings could be higher than the study had concluded, as researchers had assumed conservative costs for coal.
To date the government has signed power purchase agreements for 4 000MW of electricity.
By the end of last year, 1 600MW of renewables had been installed, 600MW of wind energy and 1 000MW of solar PV.
Cape Times