Views from a leading IPP

How does the recent clarification from the DOE about the REIPPPP relating to the qualified go-forward in respect of pricing and timing affect your prospective projects? Please answer per technology – solar PV, concentrated solar, and wind.
The proposed price amendments by the DoE has affected our entire R4 portfolio in the same manner i.e in both our wind and our solar projects the targeted price cap of 77cents per kw/h is difficult to achieve. The impact of this cap differs based on the technology, for instance our Solar CSP project on a kw/h basis cannot be compared to the wind projects that we will be closing as the CSP has a different tariff structure that has a different price for peak periods.
The timing proposed is very tight but attainable for the purposes of securing the PPA signatures.
2. What is your current view of the outlook for the REIPPPP beyond 2020? What is at stake for the country in your view?
Our outlook for renewable energy power demand post 2020 is positive, the only uncertainty at this point is the vehicle through which this renewable energy demand will be supplied. The latest version of the IRP that is being finalised will be concluded within the 1st half of 2018 if the current timetable is observed, this plan will reveal how the energy mix post 2020 will be shaped.
The consensus is that the current surplus capacity that Eskom has will run dry post 2021 and new build energy will be required. From a cost and a timing perspective there is little argument against renewable energy being the preferred optimal energy source to meet this demand as tariff prices are projected to continue dropping.
The vehicle of REIPPP or the creation of a different platform of incorporating new build energy is the only debate at this point, new build power will be required and it will need to be supplied. There is no evidence to suggest that this new build power can be supplied more timeously, within cost and budget than through Independent Power Producers.
Energy security is the fundamental risk at hand, linked to energy security is the stability of the economy itself. South Africa cannot afford to experience another point in time where our existing power generation fleet is unable to provide the foreseen energy demand required. We know when more capacity is required, the state models and accounts for this. The discontinuation of incorporating cheaper, faster and more reliable renewable energy power through Independent Power Producers increases the risk profile of our current generation fleet being unable to meet our demand curve post 2021.
3. Have you been bidding on African projects and what is your view about the opportunity for utility scale projects in Africa?  Please address issues of risk and price within this context.
We have worked on conventional power opportunities as well as renewable energy opportunities in the rest of the African continent. Zambia and Senegal are 2 regions that I can highlight, in both these markets we have identified buying programs that are structured with a strong suite of legal, financial and regulatory documentation.
The absence of structured procurement programs introduces multiple risk layers to a project which positively correlates with increased tariffs to absorb the additional risk. In both these markets we have bid in the Scaling Solar Program which allows for lower tariff bids due to the strength of the underpin behind the PPA’s. We have also worked on bilateral bids which by sheer nature have involved longer timetables with more bespoke agreements being required and a higher risk profile of success being associated with the project.
4. In respect of embedded generation in SA – what business models has your company operated – turn key project for client or lease agreements?
We have and are exploring both turn key and electricity sales lease agreement for clients. It all depends on the bespoke needs and requirements of our takers
6. Briefly summarise the growth strategy for Pele Green Energy for the next 10 years?
PGE will continue to follow new build growth opportunities in South Africa, the rest of the African market is our 5year goal with an emerging market footprint being our targeted long-term objective (5-10yrs).
As an IPP that develops, owns and operates renewable energy projects at various stages of development, construction and operation we will always focus on ensuring that we are fully occupying the critical areas of the power plants life cycle and value chain. Our initial entry strategy was to secure a footprint through holding significant minority investments in power plants, the strategy has now evolved to holding majority equity positions in the projects that we are invested in, including extending the provision of PGE’s full management, technical and operations capabilities to the projects that we hold.
Consolidation of the market will naturally take place due to the ever increasing capital requirements, we will actively analyse the secondary market to ensure that any complimentary portfolio and or companies will be brought into the Pele Energy Group.
Pele Green Energy

Three Moroccan Projects in List of ‘Most Outstanding Projects in Africa’

New York – Three of Morocco’s most prominent infrastructure projects are among the list of ten “Most Outstanding African Projects in 2015”, according to a ranking by Jeune Afrique magazine.

The Tarfaya wind farm, the Noor solar plant complex in Ourzazate and the Wessal Casablanca-Port project made it to the list of the most important initiatives that marked Africa’s economy this year.

One of Morocco’s most ambitious projects concerning green energy is the Tarfaya wind farm located in the country’s southern coast.

Consisting of 131 wind turbines with a capacity of 300 megawatts, Tarfaya wind farm is the second largest park in Africa. The project costs €450 million, the same source revealed.

King Mohammed VI of Morocco will inaugurate the first phase of solar plant “Noor I,” on Sunday in Ouarzazate, according to Minister Delegate in Charge of Environment Hakima El Haite.

The Noor Project will use a highly advanced technology called Concentrating Solar Power (CSP), which “allows to store energy for nights and cloudy days.”

Considered the world’s biggest concentrated solar power plant, the Noor is expected to produce enough energy for more than one million Moroccans, “with possibly extra power to export to Europe,” according to the World Bank.

The solar plant will be managed by the Moroccan Agency for Solar Energy (MASEN), covering an area of over 450 hectares. The plant’s first phase ‘Noor I’ cost € 600 million.

The Ouarzazate project has earned Morocco the title of “solar superpower” as it is expected to generate around 160 megawatts reaching 2,000 megawatts by 2020, the same source noted.

The Wessal Casablanca-Port project began in 2010 as a refurbishment plan to promote tourism in Casablanca.

The second phase of the project, according to the magazine, was launched by Morocco’s King last March, with an estimated cost of €28 million. It created a cultural tourism circuit of 3.7 km between the ancient city and the Hassan II Mosque.

Wessal Casablanca-Port is part of the rehabilitation program of the old medina, which includes the “building of a naval shipyard, the construction of a fishing port and the development of a cruise terminal,” the same source noted.

Among the other outstanding projects in the ranking are: the enlargement of the Suez Canal in Egypt, the first Carrefour market in Ivory Coast, a Bombardier monorail in Cairo, a 550 km pipeline between the coast of Djibouti and Ethiopia, as well as cultural infrastructures in Constantine, Algeria.

Source: moroccoworldnews

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SA cities score at COP21

The City of Cape Town and Johannesburg have been named international winners for climate action at the Paris Climate Conference (COP21).

The City of Cape Town was presented with the C40 Cities Award for “Adaptation Implementation”, recognising the City’s Water Conservation and Demand Management (WCWDM) Programme, while Johannesburg was the winner in the Finance and Development category for its Green Bond initiative.

The two cities were Africa’s only winners. The C40 Cities Awards spans 10 categories, all recognising cities demonstrating “climate action leadership”, this according the awards’ website.

Cape Town Mayor Patricia de Lille was at the awards ceremony in Paris to accept the accolade on behalf of the city, and said: “We are extremely proud of the City’s WCWDM programme which has been instrumental in establishing Cape Town as a national leader in reducing water demand and losses.

“I was greatly honoured to receive this award on behalf of all residents of Cape Town who have worked with us to reduce water demand and implement water conservation measures,” she said.

The WCWDM programme began in 2007 and focuses on water conservation and water demand management, aiming to minimise water waste and promoting the efficient use of water. It includes raising public awareness, free of charge plumbing repairs for low-income households, and the training of “community plumbers”.

Johannesburg’s award-winning Green Bond is a funding model for green projects which previously did not have any financing and could thus not be implemented.

The other categories awarded on the night included Carbon Measurement and Planning, Adaptation Planning and Assessment, Building Energy Efficiency, Green Energy, Solid Waste, Smart Cities and Smart Community Engagement, Sustainable Communities, and Transportation.

The jury included representatives from World Bank, Bloomberg Associates, World Wildlife Fund Canada, and the University of Cape Town.

Source: sbeta.iol

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World Bank sets out plan to bolster Africa against climate change

The World Bank aims to drive more funding into efforts to help African countries withstand climate change impacts and boost their clean energy production through a $16 billion plan revealed on Tuesday.

The “Africa Climate Business Plan” lays out investments to make the continent’s people, land, water and cities more resilient to droughts, floods, storms and rising seas, increase access to green energy, and strengthen early warning systems.

World Bank Group President Jim Yong Kim said sub-Saharan Africa is “highly vulnerable to climate shocks”, which could have deep effects on everything from child stunting to malaria and food price increases.

“This plan identifies concrete steps that African governments can take to ensure that their countries will not lose hard-won gains in economic growth and poverty reduction, and they can offer some protection from climate change,” he added in a statement.

The plan outlines measures for “fast-tracking” adaptation to climate change, costing almost $10.7 billion from 2016 to 2020.

They include helping some 10 million farmers adopt resource-efficient techniques and hardier crop varieties, improving water management in the Niger, Lake Chad and Zambezi basins, reducing coastal erosion, strengthening flood protection, and restoring degraded land and forests.

The African region requires $5 billion to $10 billion per year to prepare for global warming of 2 degrees Celsius, the plan said, an amount that could rise to $20 billion to $50 billion by mid-century.

But experts say pledges from some 170 countries to curb their planet-warming emissions would still permit global average temperatures to increase between 2.7 and 3.7 degrees from pre-industrial times, suggesting adaptation costs will be higher.

Levels of funding for adaptation in Africa today amount to an annual $3 billion at most, “which is negligible considering the needs”, the World Bank plan said.


Ahead of U.N. climate talks in Paris from Monday, tasked with agreeing a new global deal to curb global warming, the bank said its plan’s emphasis on climate adaptation fitted priorities expressed by African states in their national action plans submitted as a basis for the deal.

Nearly two-thirds of African country plans estimate their finance needs for adaptation, a much higher figure than for the rest of the world, the bank noted.

Funding for climate action is likely to be a sticking point at the U.N. negotiations. Developed countries are reluctant to commit to increasing the $100 billion a year they have promised to mobilise for poorer nations worldwide by 2020, when a new agreement would take effect.

On energy, the World Bank plan aims to invest in boosting solar, hydro and geothermal generation capacity, and to provide 5 million off-grid consumers with access to modern energy services by 2023, when the funding would have produced results.

The cost of that part of the plan is estimated at $5.4 billion.

The bank said it expected to contribute around $5.7 billion to achieving the $16.1 billion plan, as part of an effort to increase the share of its own financing dedicated to climate action by one-third by 2020.

In addition, around $2.2 billion is foreseen from a range of international climate funds, $2 billion from donor governments and others in the development community, $3.5 billion from the private sector, and $0.7 billion from African domestic sources.

An additional $2 billion would need to be found to deliver on the plan, the bank said.

“While adapting to climate change and mobilising the necessary resources remain an enormous challenge, the plan represents a critical opportunity to support a priority set of climate-resilient initiatives in Africa,” said Makhtar Diop, the World Bank’s vice president for Africa.

The plan also identifies longer-term outcomes that could be achieved by 2026, at an estimated cost of $21.3 billion.

Source: trust

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South African Department of Energy announces results of its latest Renewable Energy Independent Power Producers Programme

BioTherm Energy and Enel Green Power among the preferred project bidders named in the fourth round of the REIPPP initiative.

BioTherm Energy, a South African entity and an African-based independent power producer (IPP), has secured preferred bidder appointment for three projects: the 120MW Golden Valley Wind facility, 45MW Aggeneys Solar PV and 86MW Konkoonsies II Solar PV Facility, totaling 251MW of installed capacity.

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The African utility successfully constructed and now operates 49MW of wind and solar projects secured in Round 1 of the REIPPP Program. In addition, it owns and operates a 4.2MW waste gas project at the PetroSA Gas-to-Liquids (GTL) Refinery in Mossel Bay, Western Cape.

“This 251MW allocation by the Department of Energy reflects our ability to compete directly with leading international players who have come to dominate the South African landscape,” said Jasandra Nyker, BioTherm Energy CEO. “We appreciate the Department of Energy’s commitment to supporting a South African development and investment platform in this round.”

In addition, to being awarded preferred bidder status for the wind and solar projects in South Africa, the company has recently garnered success in the rest of Africa. It was awarded preferred bidder status on four solar power projects in Zambia and secured two preferred bidder solar projects in Burkina Faso. BioTherm Energy was also finalist in the Ugandan GET FiT solar facility program and is actively developing greenfield opportunities in East and West Africa.

BioTherm’s focus on sub-Saharan Africa is equally important to its growth strategy in South Africa,” Nyker added. “Regionalized growth of renewable energy such as wind or solar offers significant economic development and assists in improving the local manufacturing and services value chain. The recent announcement of the Round 4 projects adds to South Africa’s energy evolution and is a further step towards establishing a sustainable, low-carbon environment.”

Enel Green Power, for its part, won energy supply contracts for three wind power projects, including the Oyster Bay project that had been developed by RES. The 142MW Oyster Bay wind farm will comprise 43 turbines and generate in excess of 560GWh per year. Once complete, the project is expected to displace more than half a million tonnes of CO2 in each year of operation, making a dent in carbon emissions by offsetting the economy’s reliance on coal-fired generation.

“We are delighted that the Oyster Bay wind project has received preferred bidder status from the South African Department for Energy,” said Duncan Ayling, development director for RESSouthern Africa. “Such high wind energy sites represent excellent value for money for South Africans and bring socio-economic benefits to the local community through job creation, enterprise development and community trust schemes.”
Oyster Bay will be majority-owned, built and operated by Enel Green Power, a leading European renewable energy power producer. Between now and financial close, RES will continue to support the project and deliver development services in cooperation with Enel Green Power.

Source: Renewable Energy Focus

The opportunities to address the sustainability imperative arising from the current and numerous challenges facing African cities are tremendous. Exploring these is the main objective of the AFRICAN CAPITAL CITIES SUSTAINABILITY FORUM. Supported by appropriate policies, design ingenuity, innovation, technical proficiency, robust implementation mechanisms and adequate infrastructural investments, African cities can reach high levels of quality of urban life, improving drastically their environmental footprints while reaching highly competitive economic prosperity in the medium to long term. Ensuring that the most rapidly developing cities in the world develop sustainably is arguably the most important objective on the planet. Ending the negative spiral of poverty and dependence will be the reward for bold actions now!
The opportunities to address the sustainability imperative arising from the current and numerous challenges facing African cities are tremendous. Exploring these is the main objective of the AFRICAN CAPITAL CITIES SUSTAINABILITY FORUM. Supported by appropriate policies, design ingenuity, innovation, technical proficiency, robust implementation mechanisms and adequate infrastructural investments, African cities can reach high levels of quality of urban life, improving drastically their environmental footprints while reaching highly competitive economic prosperity in the medium to long term. Ensuring that the most rapidly developing cities in the world develop sustainably is arguably the most important objective on the planet. Ending the negative spiral of poverty and dependence will be the reward for bold actions now!

Sub-Sahara Green Energy Gets A $250M Boost With Japan, Standard Bank Loan Deal

Green energy projects in sub-Saharan Africa will be the beneficiaries of a US$250-million loan agreement between Standard Bank and the Japan Bank for International Cooperation, Standard Bank announced today.

The credit line will be co-financed by Mizuho Bank, Ltd, with Japan Bank providing a partial guarantee for the co-financed portion.

The funding will be used by Standard Bank to lend to green energy projects in sub-Saharan Africa, according to a prepared statement by Standard Bank.

Ben Kruger, CEO Standard Bank Group, signed the deal with Akira Ishikawa, Japan Bank chief representative, London, at Standard Bank’s new green building in Rosebank, Johannesburg.

The green building industry in South Africa has grown tremendously over the last few years, according to Jarrod Lewin with the Green Building Council of South Africa. The country has about 1 million square meters (1.07 billion square feet) of green building space.

“The green building movement is about 7 years old,” Lewin said in a CNBC Africa interview. “We started out with one-to-four buildings and we have grown exponentially year-on-year to about 60 this year.”

Initially, energy efficiency drove the green building movement, but now it’s more about about “awareness around environmental and social governance issues,” said Grahame Cruickshanks, manager for climate change and sustainability services for green buildings at Ernst & Young, according to CNBC Africa.

Standard Bank’s new green building in Rosebank opened in 2013, and it used a gas powered tri-generation plant — South Africa’s second — to produce energy simultaneously for lighting, heating, and cooling.

Tri-generation is expensive, EngineeringNews reported. It didn’t hurt that an existing Egoli Gas main gas line ran past the property, according to InfrastructureENE. Gas made commercial sense in light of sustained electricity price hikes in South Africa.

More than 60 percent of the Standard Bank building is recycled steel, according to Standard Bank. It uses automatic lighting that can detect human presence. Twenty percent of materials used in construction and all furnishings and fittings were sourced from less than 400 kilometers (248 miles) away to reduce fuel used for transportation to the site. Rainwater harvested off the roof reduces the need for potable water by 50 percent, according to Standard Bank.

Standard Bank CEO Kruger said the transaction with Japan Bank is significant for the Standard Bank Group.

“It provides a diversified funding platform to fund projects which are environmentally and socially sustainable, as well as providing alternative green sources of energy to the grid, not only in South Africa, but also in sub-Saharan Africa,” he said. “This ties into the overall objectives of the group to fund projects in Africa in the renewable energy sector.”

Standard Bank Group’s largest shareholder is Industrial and Commercial Bank of China, the world’s largest bank, with a 20.1-percent shareholding.

Source: AFK Insider



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