30.09.2016 / Press releases, Press, South Africa

Electricity wheeling: A solution for the mining sector in South Africa?

The mining industry gathered for Electra Mining Africa 2016  & Mining for the Future 2016 this week, and Greg Austin, MD of juwi Renewable Energies believes that the timing is right for electricity wheeling to be properly considered as a real solution to the energy requirements of mines in South Africa.

Mining operations require reliable power on a 24/7 basis, whether at remote locations, or in developed areas.   Load shedding, poor quality power and weak grids are forcing mines to consider alternative sources of electrical energy, and Austin believes wheeling can be the solution.

“The mining and materials industry is not in the business of energy production and won’t take on the risks involved in developing a solution as this is not their core business.  But the emergence of independent power producers (IPPs) and the possibility of power wheeling – possibly in conjunction with storage – may offer solutions to the need for a reliable supply of energy,“ said Austin. 

“For example, a solar PV plant operating in Prieska or a wind farm outside of Cape Town could supply a mine in Rustenberg by wheeling the electricity through the Eskom transmission grid, and through the Rustenberg distribution grid before it reaches the mining customer,” he illustrated.

"The emergence of independent power producers (IPPs) and the possibility of power wheeling – possibly in conjunction with storage – may offer solutions to the need for a reliable supply of energy,“ said Austin. 

The two main challenges with wheeling power are balancing generation and consumption, and determining the cost of wheeling and appropriate charges as these form the basis of most of the commercial elements related to wheeling.

“The lack of clarity on charging, regulations, open access and cross-subsidy are some of the things on the table for discussion.  In order to make this model operational, electricity regulations need to be designed to remove specific barriers to participation of developers and intermediaries who play an important role in the propagation of such systems.“ 

Austin mentioned that Nersa has drawn up guidelines and regulations covering the technical and charging aspects involved, and that the costing model is highly complex. 

Given the experiences with the ever-lowering Levelised Cost of Electricity from wind and solar under the government’s REIPPP Programme, and with estimates of additional wheeling charges being in the order of 5 to 10 cents on top of the generation cost, it is not inconceivable that wheeled renewable electricity could reduce the load on Eskom’s thermal generation fleet while reducing the consumer mine’s operating costs, on a predictable basis, into the future.

Austin added that storage in general offers advantages to the mining industry, but in the context of a grid-connected mine, the primary advantage is that of being able to shift loads, as an example, where cheap night-time electricity from the grid can be stored and provide peak power when required.

The juwi Group developed, designed and constructed a 10.6MW solar hybrid system to fully integrate with the existing 19MW diesel-fired power station at the DeGrussa Copper and Gold Mine in Australia and made it possible to configure the PV plant to provide the full load during the day, with the generator sets running at night and when low solar radiation levels exist. Over-sizing the PV system to increase the mine load, provides energy to the storage system which handles short variations in the PV output and short variations in the load.

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