King coal ponders renewables: South Africa's energy sector has long been dominated by coal-fired generation. Government insists that it wants more renewables in the mix, but little progress has been made so far. Neil Ford reports.

Author:Ford, Neil
Position:Energy
 
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The South African economy has long been driven by coal. Some of the country's biggest companies are coal mining firms, coal exports from Richards Bay Coal Terminal (RBCT) generate a large proportion of total foreign revenues and the industry provides the lion's share of feedstock for the power sector.

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Although up to four gas-fired power plants are planned over the next five years, coal looks set to remain king in Africa's biggest economy. It may therefore come as a surprise to learn that serious progress is now being made to develop South Africa's renewable energy resources.

While international interest in tackling global warming is beginning to increase, coal is often regarded as the black sheep of the power industry. Carbon emissions from coal-fired plants are generally higher than from any other form of power generation but many countries continue to develop coal-fired plants because they are usually the cheapest option in purely economic terms. South African power utility Eskom is able to offer some of the lowest electricity tariffs in the world precisely because it has access to plentiful supplies of cheap coal. As a result, it is not just the mining companies that have a vested interest in preserving the dominant position of coal.

Over the past 20 years, pressure from the business community has persuaded the government to support the supremacy of coal. The development of the country's first commercial wind farm, the Darling scheme, was subjected to years of delays because of funding problems and fears over the impact on local bird life. Yet there have been signs over the past few years that provincial governments have become more interested in encouraging the use of low carbon renewable energy technologies.

In 2004, Cape Town council agreed to pay 37 cents/kWh for electricity from the Darling wind farm, a far higher rate than the 16 cents/kWh charged by Eskom at the time. The 20MW project is being developed by Denmark's Oelsner Group, with financial support from Danish International Development Assistance (Danida), the South African government and the United Nation's Global Environmental Fund (GEF). Cape Town will buy electricity from the venture under a 20-year power purchase agreement (PPA), with first electricity expected by the end of this year.

Eskom is developing its own experimental wind project and is also examining the potential of a large-scale solar generator, but the national...

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