Page 37 - Energize November 2021

NEWS NEWS

South Africa readies for a big battery switch-on

by Michael Ball and Gabriele Buccini, March 2021 with additional RFPs for multiple sites released. This was also the time of the
Wärtsilä Risk Mitigation IPP Programme with seven of the twelve winning bidders having significant
amounts of batteries included; all are due to start construction by end January 2022.
s restrictions on self-generation Furthermore, the Integrated Resource Plan (IRP) 2019, which maps the country’s energy
continue to ease, and load mix for the next decade, provides 2 GW of battery storage by 2030 with the Minister having
Ashedding continues to escalate, it announced the first battery RFP of 512 MW to be released in November 2021.
is becoming more apparent that utility- On a smaller scale, a positive development is the amendment earlier this year to
scale battery energy storage is set to play Schedule 2 of the Electricity Regulation Act, which now allows private companies to install
an important role in South Africa’s future. embedded generation up to 100 MW. Many will want to complement their renewable
Energy storage is an essential element generation facilities with energy storage.
in an integrated system along with The localisation aspect of this procurement may be challenging despite Government’s
renewables and flexible thermal power. intention to encourage local manufacture of batteries. The dominant battery technology
South Africa’s ambitious renewable energy globally, due to its cost competitiveness, is Li-ion which is currently dominated by Asian
roll-out plans, coupled with its ageing suppliers. The cost of Li-ion batteries has been falling steadily, driven by the global roll-out of
and inflexible coal fleet, introduces grid electric vehicles (EVs), which is an important advantage for this technology. Today, however,
instability and intermittency. Batteries due to the huge global demand for batteries (both in EV’s and stationary applications), the
provide the necessary flexibility to offset market is becoming dominated by those who can obtain battery allocations. These market
the escalating integration challenges of dynamics may result in a temporary increase in battery prices soon.
higher renewable penetration. This unique supplier driven market situation could be an opportunity for South
South Africa is also taking the first Africa in terms of launching their support for increased local content which today would
steps to introduce large-scale gas- not realistically go beyond a 20% threshold. The success, however, of any localization
fired power generation. Although both initiative would hinge on ensuring predictability and consistency in the development of
flexible gas power plants and batteries the local storage market. To establish confidence with investors considering energy storage
can be ramped up and down with localisation, it is imperative that clear and transparent energy policy reform which supports
relative ease, the two technologies are market growth is timeously executed by the relevant authorities. Efficient execution of
highly complementary. While batteries energy policy is the key enabler in this regard.
are typically suited to short-duration It is crucial for South Africa’s “just transition” from coal-fired power to greener energy
applications for up to a few hours, gas that jobs should be replaced in the coal sector. Batteries may not make substantial
generation is typically well suited to contribution to job creation, but they will help to move the grid to greener energy, which
provide longer-term applications such as has significant job creation opportunities. South Africa’s IRP 2019 sketches an ambitious
weekly, monthly, and seasonal flexibility. renewable roll-out plan for 25 GW or 33% of the country’s energy contribution to be derived
The energy storage market in South from wind and solar PV by 2030. Renewable energy, backed up with energy storage, will
Africa will need to be driven both by help the country meet its Paris Agreement targets and make South African exporters of
Eskom and by the private sector. In August manufactured goods more internationally competitive. Batteries are therefore an essential
2020, Eskom began this process by issuing element of a renewable solution to/for a clean energy future.
an RFP for battery storage at Skaapvlei.
This was subsequently retendered in Contact Michael Ball, Wärtsilä, michael.ball@wartsila.com, www.wartsila.com

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