Wind power producers may provide immediate surplus power
The South African Wind Energy Association has engaged with its members to ascertain if the sector is able to provide additional power, in line with the recent call for additional energy from existing Independent Power Producers by the Department of Mineral Resources and Energy (DMRE).
The Department of Mineral Resources and Energy (DMRE)’s proposed ‘Additional Megawatt Programme’ will see the Department entering into agreements with existing renewables Independent Power Producers (IPPs) to procure additional energy that wind and solar farms could supply, over and above, what is currently allowed under their existing Power Purchase Agreements.
“We welcome this call from government and can confirm that several of our IPP members have indicated that they will be responding. They are of the view that it is possible to run their wind turbine generators (WTG) at higher power output or include a power boost to increase generation output of already installed wind turbines,” explained Ntombifuthi Ntuli, CEO of SAWEA.
She added that the industry will be seeking clarification on practical details of the ‘Additional Megawatt Programme’, but that the response has been positive overall. When the country reached unprecedented Stage 6 load-shedding in 2019, SAWEA called for the immediate release of available additional capacity from operational wind farms into the national grid, by lifting the Maximum Export Capacity (MEC) on all operating wind farms.
“Earlier this month, the IPP Office issued a call to all operational IPPs with projects in Bid Window 1 to 4, to make available additional capacity from their operational plants, in order to contribute towards closing the power supply capacity gap. It is encouraging to see that industry proposals are being taken seriously by government and are now being implemented,” said Ntuli.
Due to demand exceeding available supply capacity, South Africa has been plagued with power shortages for a long time. This is despite government’s efforts to implement a number of programmes to close the capacity gap, which include the announcement of preferred bidders for the RMIPPPP and issuing of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) Round 5 Request for Proposals (RFP) as well as announcing future procurement plans.
“Eskom’s Electricity Availability Factor has been below recommended levels for a very long time, as demonstrated by the protracted load-shedding that our country has been experiencing for well over a decade now. This indicates an urgent need to procure new generation capacity, both in the long-term and short-term, to bring the available capacity to healthy levels again,” added Ntuli.
SA’s renewable energy sector responds to negative commentary made at Dublin Climate Week
Responding to negative comments made at the Dublin Climate Dialogues, by the Mainstream Renewable Power’s former-Chairman, Dr Eddie O’Connor, on Africa’s capability to handle renewable energy investment, the South African renewable energy sector has explicitly stated their objection.
Representing the wind and solar industries, the South Africa Wind Energy Association (SAWEA) and the South African PV Industry Association (SAPVIA), stand by the conviction that the country’s and indeed the continent’s Renewable Energy sector continues to grow in South Africa with the Independent Power Procurement Programme (REIPPPP), being a prime example of a world-class programme originating in Africa.
“As an African, I am deeply offended and concerned by the unfounded statements made knowing that our industry is largely owned, operated and constructed locally, driven by our Government and benefiting the people of South Africa, while providing attractive investment opportunities for global market players, which demonstrates that we can be proud of this sector’s ascribed skills and expertise, despite being comparatively young,” said Niveshen Govender, Chief Operations Officer at SAPVIA.
The global energy industry by and large regards the African Renewable Energy market as a fast-growing market. For wind energy, the Global Wind Energy Council has reported that Africa reached 6GW installed capacity in 2020, a figure that’s expected to surge to 10.7 GW over the next five years, driven largely by South Africa, Egypt and Morocco. Similarly, the Global Solar Council estimates 6.6GW of solar PV is to be installed per year across the African continent.
The South African government designed and implemented REIPPP programme, has been hailed as being well designed, transparent and fair. In less than a decade, the sector has proven its ability to deliver over 112 independent wind and solar power projects on time and on budget adding much-needed 6000 MW+ of clean generating capacity onto the grid, as well as over R 209-billion in investment flows into the South African economy.
“We have much to be proud of – this is a sector built on the basis of government policy and our government has demonstrated the will to resolve regulatory barriers to enable the sector to grow. Renewable energy in South Africa owned and built by and for South Africans, with 84% of the total equity in the sector held by local investors, demonstrating the country’s ability to hold its own in terms of RE deployment,” added Ntombifuthi Ntuli, CEO of SAWEA.
The capability that has been built and localised in the country on the back of the REIPPPP programme is immense and extends to technical skills, manufacturing of components and auxiliary services in support of the sector’s growth.
Mainstream Renewable Power, issued a statement , 27 May 2021, announcing the resignation of Dr Eddie O’Connor as Chairman of the Board of Directors.
The Department of Mineral Resources and Energy (DMRE) recently launched the Request for Proposals (RFP) for the Fifth Bid Window (BW5) under the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP), which calls for proposals from Independent Power Producers (IPPs) to develop new generation capacity of 2 600MW, including 1 600MW from onshore wind energy and 1 000MW from solar photovoltaic (solar PV) power plants, in line with the government’s intention to increase generation capacity and ensure the security of energy supply to society. Ahead of the expected DMRE Bidders’ Conference, to be hosted on an e-platform, during May 2021, which will provide more information on the qualifying criteria and bid submission expectations, the South African Wind Energy Association has shared its impression of BW5.
“There are two key aspects of BW5 that are worth unpacking, namely the local content requirements and the bid evaluation weighting, which has now shifted in line with governments standard procurement norms,” said Ntombifuthi Ntuli, CEO of SAWEA.
The BW5 local content threshold has been retained at 40%, in line with previous rounds. The difference in this round is that there is no local content target, only the threshold is prescribed. Furthermore, for the first time, the REIPPPP introduced designated local content, which, over and above the threshold, requires bidders to procure certain specified components locally. Should these components be unavailable, bidders can apply for exemption, which needs to be lodged with the Department of Trade, Industry and Competition (DTIC).
The wind industry had extensive consultation with the IPP Office and dtic prior to the issuing of the BW5 RFP, specifically on local content requirements and what the industry can achieve in the short and medium terms. To achieve a successful localisation programme with incremental local content thresholds, a consistent procurement pipeline should be established. This would be a positive development as it facilitates augmented job creation and skills development as the economy recovers from the Covid-19 pandemic and looks to accelerated economic growth.
“Consecutive bidding rounds will enable local manufacturing facilities to be re-established and the potential expansion of already operating manufacturers, which is very crucial in creating long-term sustainable jobs,” added Ntuli.
SAWEA has, however, cautioned that the stop-start nature of procurement, and the latent bid windows, severely damaged the meaningful momentum, pre-2015, which established new manufacturing capacity within the wind and solar value chains in South Africa. Significant manufacturing capacity was lost in the delay between BW4 and BW5, with many companies being forced to shut down as a result of the delays, unable to carry the cost of overheads indefinitely.
Looking at the recovery of the manufacturing sector and the possibility of re-investment, Ntuli commented, “Whilst we wholeheartedly celebrate the new impetus, one must be mindful that regaining the investor confidence will not be an overnight process. To enable the required quantity and very importantly, quality, of components will require at least two to three years of investment and development. It is therefore crucial that further interruptions or delays are not encountered. A controlled roll-out of procurement will allow all aspects of the value chain, and not only the manufacturing sector, to expand.”
SAWEA confirms that the industry remains confident in its ability to meet local content requirements and reiterates that it has no reservations or concerns that the sector will respond positively. The Association has facilitated conversations between the DMRE, DTIC and the other key sector stakeholders, to align strategically and map the way forward to deliver on increased local content requirements.
“The wind industry has further submitted its vision to practically increase local content in the next few years and remains fully supportive of growing the local manufacturing sector,” explained Ntuli.
The Association is further heartened by the establishment of the South African Renewable Energy Masterplan (SAREM), which is set to contribute immensely to fast-tracking the establishment of local manufacturing capacity. It is intended that this framework will provide a blue-print from which government departments such as the dtic and the DMRE can provide incentives for investment into local manufacturing.
This is once again important for future bid windows and the renewable energy sector’s ability to deliver jobs and investment, in the post-Covid-19 recovery period.
“SAREM represents an opportunity to identify jobs and investment in our sector linked to the country’s resource plan, as well as to clearly outline how job creation and investment might be enhanced if impediments are removed and replaced rather with supportive policy,” added Ntuli.
BID EVALUATION WEIGHTING
A noted change in BW5 is the evaluation weighting, which has changed from a 70:30 weighting to a 90:10 weighting, indicating a distinct emphasis on tariff. Black women ownership in the project company is a new requirement and has a 5% threshold, otherwise, all other economic development requirements as per BW4 have been retained.
In previous rounds, the REIPPPP used a 70:30 (price: economic development), weighting, attaching higher priority to economic development objectives than the typical government structure of 90:10 at the time.
In closing, SAWEA has noted that the DMRE’s statement reveals that given the energy challenges the country is facing, the qualification criteria have been developed to promote the participation of projects that are fully developed and will be able to be constructed and connected to the national grid as soon as twelve months from financial close, but not later than twenty-four months post financial close.
Environment, Forestry and Fisheries publishes Geographical areas for development
31 Mar 2021
Geographical areas for the development of renewable energy development zones gazettes
The geographical zones identified as important for the expansion of South Africa’s energy mix have been published for implementation.
The Notices are part of the alignment of regulations required for the effective implementation of national environmental management legislation in terms of the One Environmental System. They will also contribute to the expansion of the country’s alternative energy mix as the country works towards a reduction in the reliance on coal for energy.
The publication in the government gazette of the development corridors for strategic gas transmission pipeline infrastructure, and large scale wind and solar photovoltaic energy facilities follows an extended public consultation period on the proposed Renewable Energy Development Zones and improved Environmental Impact Assessment processes in 2020.
Amendments to the procedures to apply for, and for decisions on, Environmental Authorisations (EA) for the development of alternative energy initiatives in what is known as the Renewable Energy Development Zones (REDZ) have also been published for implementation. The EA process has been shortened to allow for a smoother implementation of alternative energy growth in South Africa. Proactive site sensitivity work on the REDZ has been completed through two two-and-a-half year Strategic Environmental Assessment (SEA) processes. These determined the environmental sensitivity of each of the zones and corridors, and future renewable energy developments within identified zones in South Africa will require an environmental authorisation.
It is important to nnote that the Government Notice identifies and adds to, development corridors previously determined through three Strategic Environmental Assessments undertaken between 2016 and 2019.
All comments received during the extended period for public inputs in 2020 were taken into consideration when making the final decision on the corridors. With regard to the nature of the comments, several raised concerns about the contribution of greenhouse gas emissions to climate change and the risks of gas pipelines from a leakage and fire perspective.
South Africa has committed to a reduction in greenhouse gas emissions and is working towards a low emission, climate-resilient economy and society. The Presidential Climate Commission is advising government on a just transition that will leave no-one behind. In terms of the Integrated Resource Plan, a portion of the country’s energy mix is to be generated from gas. Gas is recognised worldwide as an enabling fuel for a just transition. The issue of risks was considered and evaluated through the strategic environmental assessment that was undertaken to identify the transmission corridors.
With regard to the effect of the identification of corridors for REDZ development on landowners, none will be affected at this time.
Should a decision be made to develop a gas pipeline, for example, in one of the corridors in the future, the property owner will be approached regarding servitude access. The landowner will have to have granted approval in principle, for the servitude across his/her property, prior to the submission of the application for environmental authorisation to the competent authority.
The landowner would, therefore, be fully aware of any such proposed development.
The expansion of energy supply within the pre-assessed strategic corridors will assist the country as it moves towards a low carbon and climate-resilient economy.
BioTherm Energy pioneer’s avifauna zero-loss programme
Working in collaboration with conservation organisations, BioTherm Energy’s Excelsior Wind Energy Facility, in the Western Cape, is pioneering the wind industry’s approach to conserving avifauna. The programmes that are being implemented go beyond looking at the potential impact of their wind farm on birds through mitigation, but are also aimed at a net gain in priority species, including Cape Vulture, Black Harrier, Verreaux’s Eagle and Martial Eagle.
The on-site mitigation programme to avoid losses includes an industry-first implementation of an observer-led ‘Shut Down on Demand’ (SDOD) system for priority species.
The SDOD system is implemented through notification by a team of bird monitors to the wind farm’s on-site operations room, where individual wind turbines are switched off when the priority species are in the vicinity and switched on again once the bird has passed by.
This SDOD system, which was piloted in August 2020 before being fully implemented, has to date resulted in no less than sixty SDODs being successfully called for.
“This direct mitigation through shutdowns has resulted in zero loss of priority species to date, meaning that we can proudly say that there have been no turbine collision fatalities so far, and we expect the same into the future.”
Libby Hirshon, BioTherm Energy’s Sustainability Director
Additionally, the programme provides local job creation. The eight biodiversity monitors, who are predominately female, in addition to their supervisor, have been recruited from the surrounding communities. The team of monitors is sited at three vantage points, seven days a week, and is responsible for the implementation of this rigorous programme through active communication with the operators.
BioTherm Energy also recognises that in the Overberg region, where the Excelsior Wind Energy Facility is situated, many bird species are also susceptible to powerline collisions, which has been well documented by the Endangered Wildlife Trust (EWT). This poses a significantly greater threat to certain species than wind turbines, including South Africa’s national bird, the Blue Crane.
“We approached the EWT to discuss potential conservation initiatives, and the result was the rollout of over four thousand bird flight diverters to mitigate avifauna fatalities along high-risk powerlines near, but not directly associated with, our project. We believe that this initiative will prevent needless collisions by Blue Cranes, Cape Vultures, and a host of other raptors. We have no doubt that, through this kind of collaboration, we can create innovative solutions where both conservation and renewable energy can coexist and even enhance each other,” commented Hirshon.
The EWT’s Wildlife and Energy Programme Programme Manager, Lourens Leeuwner, was recently reported in the media saying, “It is extremely encouraging to see an IPP actively seeking opportunities to conserve priority bird species in the regions surrounding their facilities. BioTherm Energy is actively engaging with project partners and looking to bolster conservation initiatives around their wind energy facilities”.
The wind farm’s off-site conservation activities also include work with the Overberg Renosterveld Conservation Trust (ORCT) to provide funding for the securing of easements for the protection of the Renosterveld (a critical habitat for the Black Harrier).
A variety of factors are making the offshore wind industry a strong candidate for growth, but market dynamics are creating uncertainty. While traditional players are pursuing aggressive growth strategies, new entrants are reshaping the landscape.
The offshore wind industry is gaining momentum thanks to ambitious environmental targets, competitive costs, and huge market potential. This renewable source of energy provides an optimal load factor, minimising the need for electricity storage or complementary dispatchable sources of energy. The public sector has been rushing the field with new players, including oil and gas companies, creating a strong push for investments in the wake of the Covid-19 crisis.
Ambitious national targets
Since the 2015 United Nations Climate Change Conference, most governments have launched energy transition strategies and are adopting a variety of approaches to decarbonize.1 Historically, offshore wind development mostly took place in Europe in the North Sea, and China has set ambitious targets for offshore wind. But so far, the United States has been less ambitious. The European Union (EU) is aiming to install between 230 and 450 GW of capacity by 2050, and China announced 175 GW over the same horizon. Meanwhile, the United States is aiming for only about 85 GW. Although there is less visibility on China’s road map, offshore wind could help accelerate the end of coal power—improving air quality and ensuring energy security along the way.
The economics of offshore wind are improving as the costs come down and the energy source becomes more competitive with not only fossil fuels but also other renewable technologies, including solar photovoltaics (PV) and onshore wind.2 As wind turbines grow (up to 12 MW and already announced 15 MW), the load factor could reach new records— above 60 percent—making offshore wind technology even more cost-competitive in the future.
The International Energy Agency (IEA) predicts a sharp decline of offshore wind’s levelised cost of electricity (LCOE) until 2040, down from about €150 per MWh to €25 to €45 MWh depending on the geographic setting.3 This has enabled a key change with the emergence of subsidy-free bids (see figure 1).4
Huge energy potential
Despite significant growth over the past several years, mostly in Europe, offshore wind is still a very small share of world power production (68 GWh in 2018, or about 0.3 percent) and installed capacity (28 GW in 2018, or about 0.4 percent).5 Technical sources offer a power potential of more than 25,000 GW globally, with the United States having the largest offshore wind technical potential both for near-shore and far-from-shore zones (more than 10,000 GW).
Offshore wind capacity is expected to grow by about 25 GW per year over the next two decades, activating a limited share of technical potential.6 Furthermore, offshore wind is displaying strong resilience amid the Covid-19 pandemic with annual capex expected to equal offshore oil and gas capex both in Europe by 2021 and in the United States over the next decade. 7
Market dynamics are creating new tensions in the offshore wind industry
Attractive growth prospects are creating complexities and challenges in four areas:
Regional specificities with uneven strategies
The development of offshore wind is influenced by local market factors, and countries are adopting a variety of approaches to foster renewables growth:8
Energy security. This is a key incentive for the EU, but the United States is less concerned despite benefiting from the world’s largest source of offshore wind. The EU has defined a clear ambition with a strong commitment from countries and structured supporting policies, including the Green Deal, potentially boosted by the Next Generation EU recovery plan.
Wind turbine manufacturing capacity. This is well-established in the EU, with leading capacities already deployed in the North Sea. In the United States, offshore wind is still an emerging market, with only 30 MW of installed capacity in the first half of 2020. In the United States, despite strong fundamentals such as the technical potential and support mechanisms, full development of the offshore wind value chain is far from achieved and will require structured support. In China, offshore wind should benefit from a centralized administration, adequate infrastructures, potentially huge wind turbine manufacturing capacities, and logistics capabilities. This implies short contracting procedures, government support, and no public acceptance issues.
Power grid flexibility and regulation. These areas could provide additional complexity and embed various integration capacities, such as grid connection technologies, bidding processes and contracts, merit order, and support mechanisms for connection costs. Even if some countries have already reached their integration capacity, the European network is very well integrated, providing additional capacity for offshore wind integration. The US power grid is fragmented and has a limited capacity to deal with a large share of intermittent electricity. China’s power grid is integrated, which would favor the integration of wind power. Finally, large hydro-storage capacities provide the ideal combination with wind offshore.
Larger and more complex scope
This year marked a step-change in the size of wind farms, with the largest wind farm size doubled compared with past years (see figure 2). In addition, hybridisation with other technologies will be crucial for economic and environmental viability. Recent bids show a combination of offshore wind with green H2 (electrolysis). For example, in July, Shell and Eneco were awarded a tender to create a wind farm-powered green hydrogen hub.9
On the technology side, floating solutions can unlock additional upsides. They address the largest technical potential of offshore wind (72 percent of offshore wind’s technical potential is in deepwater) and higher load factors, driven by better wind conditions. In addition, floating solutions enjoy better acceptability and reduce usage conflicts with other sea activities, such as fishing, coastal navigation, and recreation. However, several challenges are yet to be addressed, including the high upfront cost and long project timeline, the infrastructure needed to assemble turbines, and full-scale testing and demonstration (coping with pitching and rolling, resisting harsher weather conditions, and handling cable complexity). The design of floating solutions is also still at an early stage of development.
Increasing competition and key players’ strategic moves
The offshore wind landscape is becoming more crowded with several new entrants along the value chain. While traditional players are pursuing aggressive growth to stay ahead of the game, solid new entrants are reshaping the offshore wind landscape.10 The net-zero boom hit the oil and gas majors in 2020, with Equinor followed shortly by most peers. To support their net-zero targets, oil and gas operators are walking the talk with several offshore wind initiatives launched over the past year (see figure 3).
On the project development side, traditional oilfield services and engineering, procurement, and construction (EPC) players are capitalizing on their offshore capabilities and diversifying into offshore wind (see figure 4). Traditionally, oil and gas EPC had been marginally involved in offshore wind projects as subcontractors for specific activities with limited scope, such as installing foundations for pilots or small wind farms. Now, they are repositioning in the value chain to deliver larger, more complex project scope—from subcontracting for large wind farms to taking on engineering, procurement, construction, and installation (EPCI) roles for a defined project scope. In the future, the role of EPC players may evolve to deliver turnkey projects for a full wind farm, with examples so far only seen in Asia.
Potential supply chain bottlenecks
Delivering the potential will most likely stretch the value chain, with bottlenecks for turbine production and logistics. The first question will be about whether original equipment manufacturers (OEMs) have the capacity to expand production to meet demand. Over the past several years, OEMs delivered an annual installed capacity of about 7 MW, but demand will grow to about 20 to 30 MW per year until 2030 (see figure 5). This gap could be even wider depending on OEMs’ financial situation. In parallel, high demand in marine logistics (offshore vessels) could create scarcity and tension on prices.
How to win the new gold rush
As discussed, offshore wind energy is a strong candidate for massive growth in some regions. However, an array of market dynamics are creating tensions that are impacting the value chain and creating potential bottlenecks that could impact the overall outcome of projects. Winning the new gold rush will require taking a systematic and collaborative approach.
Choose your battles
The first priority is to identify the sites that have the highest strategic value for your objectives, including growth targets, the portfolio, and the footprint. It will also have implications for local factors, such as grid connection technologies, bidding processes and contracts, merit order, support mechanism, and time to operations, as well as for regulations, such as the Urban Planning Code authorisation for building turbines of more than 12 MW.
Bidders will need to master the contracting process across countries and regions, including understating the prerequisites and differentiating elements to win the bid. The competition is getting tougher. For example, in the Dunkirk wind-farm award, the top five bidders all scored very closely in the tender criteria, with a slightly bigger difference in the bid price: €44 per MWh for the winning and between €47.5 and €51 per MWh for the others.11
Streamline the wind-farm delivery model
Delivering much larger and more complex wind farms requires moving away from the traditional master–servants project development approach with its many siloed interfaces. Collaborative design optimisation could significantly reduce costs and fast-track the time to market. Offshore could unlock significant value by taking advantage of lessons learned from other industries, such as automotive, aerospace and defense, and electronics. While the oil and gas industry has traditionally struggled to do so, offshore wind has the features needed to be successful, with strong standardisation potential and flexibility for lean design (lacking heavy legacy specifications).
A new delivery approach also requires new business models and new ways of working. Strategic alliances are a win–win for operators, OEMs, and EPC to tackle the following elements:
Improve the project economics by working together to address large cost areas, taking on the full envelope of costs and seeking to bring it down as opposed to traditional sourcing requests for proposals (RFPs) that are focused on price and likely to increase with change orders.
Reduce cycle time by accelerating execution and avoiding RFP and tender processes.
Develop technological synergies with contractors by engaging them in advance to elaborate on designing an optimal solution.
In a capacity-constrained environment, strategic alliances also offer opportunities to secure material and services while giving suppliers certainty about revenues. Oil and gas players (operators and EPC) can also capitalise on their strong offshore experience.
Repurposing assets and reskilling the workforce requires a new cross-business portfolio view and management, such as multipurpose vessels serving oil and gas platforms and wind farms, and talent management, such as sharing resources across oil and gas and wind projects.
Achieve operational excellence
Operators will need to assess and extract the wind farm’s true potential. With more pressure to reduce costs and with subsidy-free bids becoming the new norm, operational excellence is paramount to maximising profitability.
Smart operations are a must to optimise both the top and bottom line by considering a broad set of parameters, such as revenues, cost of spare parts, market dynamics, regulations, turbine downtime, weather forecast, and operations and maintenance costs.
Advanced analytics could allow for precisely predicting the impact on costs and revenues to inform decision-making and optimise profitability.
Predictive maintenance enables striking the right balance between corrective and preventive costs, including the costs of failure, reducing total expenditures, and increasing availability and reliability.
Digital twins can extend the life of assets by combining operational and physical inputs, such as inspection information and mechanical characteristics, with advanced simulation, such as fatigue analysis, inspection plan, and predictive maintenance. In addition, using digital twins in the engineering phase could optimise design and reduce material and installation costs.
Squeeze financial value
Finally, operators will need an integrated approach to optimise their financial value.
Value pools. The boundaries between sourcing, trading, and production are blurring, driven by demand response, batteries, and decentralised generation. New value pools are emerging from all parts of the chain.
Contractual and physical flexibility to match supply and demand and balance the grid, such as capacity contracts, virtual storage, and options and derivatives, drives portfolio optimisation and provides growth opportunities.
The operating model needs to adapt to allow an integrated steering of power assets, such as renewable, storage, and combined cycle gas turbines, and consumption, such as internal and external, by location, minimum and maximum load, and steerable load.
Decision-making. With renewable energy growth, the power market is becoming more weather-driven, and demand for flexibility is moving toward the short term. Consequently, the speed and quality of decisions are paramount to ensure smooth alignment between power assets and consumers, such as scheduling and re-dispatching processes with assets and consumers to avoid imbalance costs and capture market opportunities as well as increased frequency balance to manage renewables generation unpredictability. To support quality and efficient decision-making, information system infrastructure and data management are crucial to achieve the following:
Combine massive amounts of data in real-time.
Develop robust data analytics for optimization (analytical models with accurate signals, confidence estimation, and visualisation).
Define the trade-offs for result accuracy versus computation speed.
Ensure seamless interactions between independent information systems and functionalities.
Define the trade-offs between multiple performance models versus a full integrated model, such as individual turbines, wind farms, and country-level portfolios.
Facilitate internal and external data exchanges.
Get set for the race
Think big and act fast
The economies of scale for large wind farms (more than 1 GW) is the new norm for cost-competitiveness. All players are moving.
To leapfrog the competition and not get left behind, it is imperative to quickly screen and target opportunities. Where to start will depend on players’ maturity. In any case, it is important to accelerate the learning curve. For new entrants, this may mean starting with smaller roles or a smaller scope and quickly transitioning to larger, more complex ones.
Choose your partners, and nurture the collaboration
Winners will play a team game with strategic alliances and collaboration across the value chain. This will ensure delivery capacity, such as turbine production, installation, and footprint as well as best-of-breed skills, such as technology and knowledge while accelerating innovation. A cultural fit and collaboration framework will be essential to success.
1 European Commission Climate Action Tracker
2 Intergovernmental Panel on Climate Change 2018 special report, International Energy Agency, International Renewable Energy Agency
3 International Energy Agency World Energy Outlook 2019
4 Aurora Energy Research, offshoreWIND.biz, European Commission electricity market reports, Kearney Energy Transition Institute
5 International Energy Agency World Energy Outlook 2019; “Wind energy,” International Renewable Energy Agency
6 International Renewable Energy Agency, Global Wind Energy Council, International Energy Agency
7 “Covid-19 monthly update: 2020’s oil demand recovery slows down, road fuels upgraded for 2021,” Rystad, 12 June 2020; “US offshore wind power spending has oil in its sights,” Financial Times, 7 July 2020
8 International Energy Agency
9 Shell media release, 29 July 2020
10 Company websites, press review
11 Commission de Regulation de l’Energie, Deliberation N. 2019-124
Wind energy industry celebrates new bid window for renewable procurement
The South African Wind Energy Association (SAWEA), together with the broader renewable power sector, are celebrating the Department of Mineral Resources and Energy’s (DMRE) announcement to open a new procurement round.
DMRE Minister, Gwede Mantashe, announced the opening of Bid Window 5 of the Renewable Energy Independent Power Producers Procurement Programme (REIPPPP), which will procure a further 2 600MW of renewable energy from Independent Power Producers (IPPs).
“The announcement by the Minister to open Bid Window 5, calling for proposals from IPPs, marks the rebirth of the wind energy industry, as the last bidding round took place almost seven years ago, in 2014.”
Ntombifuthi Ntuli, CEO of SAWEA
The Energy Minister has set a firm closing date for the Bid Submission as August 4, 2021.
Addressing energy stakeholders in Johannesburg earlier this month, Minister Mantashe said the auction, which aims to procure 1.6GW of wind energy, is in line with the gazetted IRP2019.
The wind energy industry is dependent on policy tones set by government. The Association has noted and is grateful to the various government departments, for implementing policies over the last two years. The wind sector sees these changes, which are closing policy gaps, as a clear direction in terms of plans to procure new generation capacity on an ongoing basis, in line with the energy roadmap, which sees 14.4GW of new wind power over the next decade.
This procurement window, will add vitally needed power capacity to the country, which continues to struggle with strangled energy supply, an ongoing crisis that is economically crippling and has seen South Africa buckling under the strain of load shedding for the last few years.
“With supporting policy and smooth procurement rounds, expected to include the announcement of Bid Window 6 during the course of 2021 as reiterated by the Minister today, the renewable power sector certainly has a key role to play in re-building the country as a significant catalyst of economic growth, and investors have a big role to play in making that a reality,” adds Ntuli.
Minister Mantashe simultaneously announced the preferred bidders for the procurement of the 2000 MW Risk Mitigation Independent Power Producer Procurement Programme (RMIPPPP), which SAWEA recognises as a significant move, as wind and solar will now be able to play a role in dispatchable power.
Two of the eight preferred bidders in RMIPPPP include wind power IPP’s in the form of hybrid projects. These projects incorporate wind, solar and storage technology on a utility scale, which is a first for South Africa.
SAWEA has noted that this is a massive advantage for the country, as hybrid projects enhance the reliability and stabilisation of the power generation system. Plus, they do not always require grid expansion, as hybrid grids produce power at different intervals and during complementary seasons.
The advantage of hybrid systems, when incorporated with storage, is that the power is ‘dispatchable’. So, when the wind or solar systems are not generating power, hybrid systems provide power through batteries. Whilst the battery capacity needs to be large enough to supply electricity during non-charging hours, when they run low, the generating plant can provide power to recharge the batteries.
“An advantage of renewable energy hybrid systems lies in their ability to combine two of the fastest growing renewable energy technologies. Hybrid systems can also take advantage of the complementary nature of solar PV, which produces power during the day, and wind, which produces most of its power at night,” concluded Ntuli.
Women in power: the energy sector is lighting the way
A decade into South Africa’s renewable energy sector’s existence, it has become apparent the sector is still lagging in sufficient gender diversity. Hence the industry is actively giving attention to adjust and improve the levels of gender representation, at all levels, with the launch of its Gender Diversity Working Group.
“Gender diversity means a fair gender representation across all spheres of our industry. A 2020 report by IRENA and the Women in Wind Global Leadership Program shows that women represent only 21% of the global wind energy workforce and only 8% of its senior management. Recognising that the challenge of underrepresentation of women in the wind energy sector is as much a South African challenge as it is a global challenge, we launched a Commitment Statement in 2018, which commits members of the Association to address, amongst other things, issues of gender equality in the sector,”
This sector Working Group will mainstream gender issues within the renewable energy industry by creating a platform and framework that will actively address gender diversity matters within the energy sector and to hold dialogues around areas of inadequate representation.
This new renewable energy industry Working Group is a collaboration between SAWEA and the solar PV counterpart association, SAPVIA, as both organisations recognise the need to address gender diversity issues from a broader renewable energy industry perspective. Additionally, the collaboration includes WE Connect, an NPO focusing on women empowerment within the renewable energy sector, with the intention of maximising capacity and increasing the programme’s impact by incorporating gender coaching and mentorship.
“Diversity in the workplace is vital for the future success of every organisation. Countless studies have shown the positive effects gender diversity can have in every industry and we must work together to ensure that South Africa’s renewables sector is truly reflective of the society in which we operate.”
SAPVIA COO, Niveshen Govender
“As a sector our ambition is to deliver a just transition and this must include the upliftment and inclusion of all genders. This is not just because it is the right thing to do – it also makes commercial sense. From widening the talent pool to enhancing collaboration, improving retention, recruitment and reputation, the payback of an inclusive workplace has never been clearer.”
“There could not be a more fitting time than International Women’s Day to bring together this Working Group. The onus is of course on each of us as individuals to challenge the status quo, however with this group we can collectively take proactive steps to drive the change that is so needed in our sector to create a more balanced workforce across the renewables industry.”
Looking inwards, the wind sector’s governing association is in fact operated under female leadership, and has done so for a number of years. SAWEA has been led by both a female CEO and Chairperson for the past two years and is supported by a women-dominated team.
“Our team is demonstrative of how women display emotional intelligence and innovative thinking that brings a different perspective, as women are naturally visionary forces. Our shared vision has created cohesion and has meant that we have been able to achieve the association’s goals, whilst contributing to a positive culture,” adds Ntuli.
The Gender Diversity Working Group Programme is expected to include a Leadership Acceleration Programme (LAP), which will identify women with leadership potential and place them on an accelerator programme to help bridge the female leadership gap in the sector. This is in addition to the coaching and mentorship programme, led by WE connect, which will pair mentors and mentees and assist them to meet certain objectives.
“Diversity in thought will contribute positively to the thriving and growing renewable energy industry. Through mentorship, the industry can empower women, bridge the gap between male and female perspectives on equality and promote the concept of giving back,” said Karen de Bruyn, Founder of WE Connect.
Looking beyond the professional space, the programme will also include a ‘Business Opportunities for Women’ initiative, to provide access for women in entrepreneurship activities in the sector and to support women who are establishing themselves as entrepreneurs.
The Working Group also aims to achieve the following: Gender Diversity Performance Reporting, which will include a scoring matrix; Dialogues and Events, as discussion platforms to address common challenges and shared solutions on gender issues; and the launch of a Renewable Energy Industry Gender Diversity Charter – in line with the Industry Commitment Statement.
“Simply put, the ultimate target is to see women in the sector having access to and being considered for all opportunities,” concludes Ntuli.
SAWEA’s Gender Diversity Working Group plans to address disparities within the sector
Ntombifuthi Ntuli, CEO at SAWEA, in conversation with the publisher of GreenEconomy.Media Gordon Brown
Don’t miss this live online broadcast on International Women’s Day [Monday, 8 March 2021, 13:30]
Ntuli introduces the gender diversity initiative [below].
The purpose of Gender Diversity Working Group is to create a discussion platform for the wind energy sector to: firstly, actively develop plans to address gender diversity matters within the energy sector and to hold dialogues around areas where there is not enough representation; and secondly, to initiate programmes that will ensure that the sector gender diversity objectives are met.
The current health pandemic has highlighted the reality that if the healthcare services, in the rural Eastern Cape, are to meet the needs of communities, it cannot manage on government resources and funding alone.
This was the message from MEC Mlungisi Gerald Mvoko (MEC: Finance, Economic Development, Environmental Affairs and Tourism), who addressed officials and other parties, gathered to receive an official handover of much-needed health equipment, donated to the Andries Vosloo Hospital, a Provincial government-funded hospital for the Blue Crane Route Local Municipality area, in Somerset East, Eastern Cape.
Giving recognition to the funders, for the contributions to the community, and the dire need for help and assistance, the MEC also spoke of the devastation caused by fiscal cuts to the Eastern Cape of over R29 billion over the next 3 years, reiterating the importance of supplementary private sector support.
“Without the help of private companies, we cannot deliver the quality of service required in these trying times of the pandemic.”
MEC Mlungisi Gerald Mvoko said,
“The equipment and medical supplies, intended to cushion the blow of Covid-19 on this hospital, was donated by BioTherm Energy’s Golden Valley Energy Facility, in collaboration with Cookhouse Wind Farm.”
He added, “This is the only hospital in the area to service the needs of the community, and more specifically, the Covid-19 needs, which is why we need partners to come on board, as they are able to fill the void and complement us where we, the local Government, are lacking.”
Loretta Di Zio, Economic Development Director for Golden Valley Wind Energy Facility said, “This collaborative donation directly assists local government in delivering community health care, of which we are pleased to be part of, as we view this as an important indicator of our support for the needs of the community and ongoing partnership with our direct economic beneficiaries”
In addition to MEC Mvoko, the event was also attended by the Executive Mayor: Nontuthuzelo Marjorie Scott, Mayor of Blue Crane Route Municipality; the CEO of Andries Vosloo Hospital, and the Acting District Manager of Sarah Baartman District Department of Health, and other affected parties.
MEC Mvoko also gave recognition of the collaboration with Cookhouse Wind Farm and saw it as an important example that the Government of the Eastern Cape should take note of in collaborating with each other.
There can be no doubt that the Eastern Cape Province has been the hardest hit area in the country, with more fatalities and obvious desolation. To-date over 11 000 people have been lost, which is not only the highest rate in the country, but disproportional per capita.