green electricity – a new paradigm for more sustainable energy service provision? city energy...
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Green Electricity – a new paradigm for more sustainable energy service
provision?
City Energy Strategies ConferenceCape Town
19th – 21st November 2003
Glynn Morris, AGAMA Energy
Green electricity – what is it?• Green electricity, or Green Power, is electricity
which is certified to be different from ‘normal’ electricity on the basis of how it is generated and supplied to customers
• The certification ensures integrity that the generation is: from renewable energy resources, such as
• Solar energy• Wind energy• Biomass energy• Hydro energy• Wave or tidal energy
the manner which is sustainable
Why is Green Power of interest?• We need energy services, including those provided by means of
the electricity system• The differing climate change implications of electricity
production indicate the need to differentiate the quality of different types of electricity
• Green power is less environmentally damaging than non-green (=conventional) power Resource consumption Emissions / waste
• It offers a mechanism for delivering more sustainable energy services which actually create New long-term employment opportunities Decentralized economic development
Electricity generation in South Africa
HEX RIVERSALT RIVERCENTRAL WEST BANK
COLENSO
CONGELLOSOUTH COAST
UMGENI
BRAKPAN
KLIP
ROSHERVILLE
TAAIBOS
VAALVEREENINGING
WILGEWITBANKGEORGE
VIERFONTEINHIGHVELD
KOMATI
INGAGANE
CAMDEN
GROOTVLEI
HENDRINA
ARNOT
GARIEP
KRIEL
ACACIA PORT REX VAN DER KLOOF
MATLA
DUHVA
CAHORA BASSA
DRAKENSBERG
KOEBERG
TUTUKA
LETHABO
MATIMBA
KENDAL
PALMIET
MAJ UBA
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
55 60 65 70 75 80 85 90 95 00 05 10 15 20 25 30 35 40 45 50 55 60
Year
Me
ga
wa
tt In
sta
lled
55 60 65 70 75 80 85 90 95 00 05 10 15 20 25 30 35 40 45 50 55 60
Source: ESKOM
Generation capacity and investment requirements in SA
• In the absence of DSM or SAPP imports, South Africa needs: a continuous investment programme for new electricity
generation capacity Approx. 1000 MW per annum by 2007 (=$1 billion p.a.)
• a strategy for replacement of 25 GW of existing capacity by 2020 (=$25 billion)
• Based on the comparative social and environmental benefits, renewable energy technologies should comprise at least 15% of this new investment (= minimum of $150 million p.a.)
Employment in coal-generated electricity sector
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
20000019
8019
8119
82
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Year
Ou
tpu
t (G
Wh
)
0
15000
30000
45000
60000
75000
90000
105000
120000
135000
150000
Job
s
consumption:coal-generatedelectricityelectricity-relatedmining jobs (53%)
Eskom jobs
total jobs
Source: Own analysis, based on data from Eskom (1989), Eskom (2002), Statistics SA (1995), Statistics SA (2002), NER (2000), DME (2003c).
Comparison of all generation technologies: gross direct jobs/TWh-equivalent
80 130 700 952 13413778
8733
16318
0
5000
10000
15000
20000
technology
dire
ct jo
bs
An employment scenario for 2020• Based on:
•15% by 2020 and 100% local manufacture•projected electricity requirement of 267 TWh in 2020•current coal-based electricity consumption of 182 GWh in 2000 employing 59,987 people•there will be a net increase in both production and employment in the coal-based generation sector. There will be 36,373 new RET-related jobs in 2020.
Gross direct jobs in 2020 by technology to meet projected generation requirement
0
5000
10000
15000
20000
25000
30000
Coal Wind Biomass SolarThermal
solar PV landfill
technology
additional generation in2020 (GWh)
gross direct jobs
What is the international experience with Green Power?
• Approx. 10 years of experience in Europe, USA and Australia
• USA About 40% of retail customers in the United States now have
an option of purchasing a green power product directly from their electricity supplier.
15 marketers now sell "Green-e" certified TRCs nationally < 1% of US consumers are buying Green Power
• Similarly, in Germany and the United Kingdom this percentage is less then 1% of the households.
Green electricity in the Netherlands
• Over 13% of the Dutch households use renewable energy
• The amount of customers in The Netherlands is still growing fast
• Soon there will be 1 million of Dutch households using green energy
Typical announcement• Federal Green Power Purchasing Soars
• The U.S. Department of Energy's Federal Energy Management Program reports that federal purchases of green power have surged in recent months. Over the last year, federal purchases increased from 125 million kWh to more than 300 million kWh-the Department of Defense alone has at least 19 agreements to purchase renewable energy or renewable energy credits, totaling approximately 200 millionkWh annually. Green power purchases represent nearly one-half of the renewable energy resources acquired by the federal government since 1990 to meet the intent of Executive Order 13123, which is to encourage greater use of renewable energy by the federal government.
• [ http://www.eere.energy.gov/greenpower/0903_femp.shtml ]
Is green electricity relevant in a developing country like SA?
• YES• In addition to DSM/conservation gains, we need new generation capacity• Green Power opens the door for
political commitments to RE ( mandatory quotas – some Green Electricity for ALL) consumer choice ( the voluntary market – 100% Green Electricity for those who wish
to pay for it)• It offers excellent opportunities for moderating the heavy dependence on coal
and nuclear generated electricity in the southern African region – diversification of the mix
• Diversification brings with it: Potential employment Risk adjustment of the economic costs of generation
• Technical considerations include: Distributed generation Efficiency – lower transmission and distribution losses Greater flexibility and stability in the generation mix Energy security
What is the cost of Green Electricity?
• Green electricity costs more or less the same as ‘normal’ electricity, BUT
• the full costs of ‘normal’ electricity are not included in the price we pay per unit of electricity
• We pay the hidden costs (or external costs) of ‘normal’ electricity through our taxes (say, for example, to cover the costs of mining / nuclear accidents or oil spills) and the depletion of the quality of our health and the environment
• present cost of ‘normal’ electricity can range between 15 – 40 c/kWh
• At the WSSD, the NER approved a voluntary tariff of 50 c/kWh
Costs - cont’d
• Overall it is expected that the costs of Green Electricity will fall (in real terms), as economies of scale kick in and with technical developments, whereas conventional electricity costs are predicted to rise – to reflect the full economic costs of production and also due to increased input costs for land, water, fuel(s) and risk
0
200
400
600
800
1000
1200
1400
1600
1800
0 10 20 30 40
Years
Uni
t cos
t of e
lecr
icity
(c/k
Wh) Green elecricity
'Normal'electricity
What are the benefits of Green Electricity?
• It is less damaging to peoples’ health and to the local and global environment
• It asserts the positive value of more sustainable electricity generation and utilisation
• It provides more long-term employment creation than conventional energy systems
• It can be implemented at any scale – from 1 kW to 1 GW• It can be implemented quickly – with shorter lead times (=less
risk) than large conventional power stations• It offers economic empowerment opportunities because it can
be owned by individuals and SME’s, in addition to large corporations or parastatals
What are the benefits of Green Electricity – cont’d?
It can be implemented anywhere on (or off) the national grid and hence provide for more decentralised economic development
It offers an easy, but meaningful, way for public authorities and businesses to demonstrate their commitment to more sustainable operating policies and more equitable triple bottom line reporting
It assists the government objectives of increasing the amount of renewable energy in the South African Energy economy – as set out in the 1998 White Paper on Energy Policy and Draft White Paper on Renewable Energy (www.dme.gov.za/energy/)
What are the constraints on Green Electricity
Higher average cost (at present) to the consumer per unit of electricity
Lack of familiarity – consumer and political awareness Lack of support infrastructure for implementing and operating
green electricity systems Green electricity cannot immediately replace all the more
conventional electricity generation and supply systems – this will be a gradual process which will have to start somewhere and grow systematically
Is there a market for Green Power in South Africa?
• We don’t know
• Market surveys have been undertaken in Cape Town (2002) and Johannesburg (in progress)
• Indications are promising but are not tested or proven
What is the available capacity in the region?
• There is currently more than 200MW of existing generation capacity in SA which meets the NER draft criteria
• Includes: Biomass CHP Small sustainable hydro Wind Solar PV – both grid-connected and off-grid
• The real objective of Green Power is to stimulate investment in NEW green generation capacity
Eskom wind demo site - Klipheuwel
Grid-connected PV systems
Wind and solar in Kimberley
Temaruru Community Managed Wind Powered Mini Grid, Zimbabwe
Policy and Regulatory context• The White Paper on Energy and Draft White Paper on RE both support
the development of the RE sector• The key to a meaningful Green Power sector is the integrity of the
certification and regulatory framework• In 2002, the Green Power for the WSSD Project supplied 845MWh of
green power to the World Summit venues pioneered a regulatory and trading framework (using a TREC mechanism) which was endorsed by the National Electricity Regulator in SA
• The Regional Electricity Regulators Association (RERA) in southern Africa is supportive of regional trade of Green Power
• The FCO in UK is supporting a study into the role for TRECs for regional trade of Green Power in southern Africa
• The REEEP has identified Green Power as a key opportunity for accelerating the development of RE technologies
Green Power for the WSSD
• a project grant under the DEAT climate change program funded by USAID
• 845MWh of Green Power supplied to the two main venues of the WSSD
• In association with NER, CityPower, green generators, UBUNTU Village (JOWSCO) and NASREC Expocentre
Eight good reasons to choose Green Electricity
• Reduce the negative resource consumption and Climate Change effects of electricity use
• Demonstrate environmental responsibility• Provide competitive advantages• Valuing energy and achieving energy savings• Hedging against present and future financial uncertainties• Stabilise volatility in operating costs• Enhance relations with employees• Strengthen relations with local communities
Adapted from: WWF 2002
Links
• EUGENE: www.greenelectricitynetwork.org• Global Warming: www.climatehotmap.org• Green Energy in Europe: www.greenprices.org• International Panel on Climate Change: www.ipcc.ch• International Council for Local Environment
Initiatives: www.iclei.org• European Sustainable Cities and Towns Campaign:
www.sustainable-cities.org• REEEP: www.reeep.org• AGAMA Energy : www.agama.co.za
Thank you !
AGAMA Energy (Pty) LtdP O Box 606, Constantia, 7848
South Africatel: +27 21 701 7052fax: +27 21 701 7056
cell: +27 83 780 9460glynn@agama.co.zawww.agama.co.za
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