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Press Release
Workshop: Electricity from cogeneration projects can be delivered to South African grid
March 13, 2007 Fieldstone and NERSA, the National Energy Regulator of South Africa, organized a workshop in Johannesburg to discuss the conditions under which South African industries can deliver excess electricity from cogeneration to the national grid.
The workshop was organized to get feedback of a wide group of South Africa industries on Fieldstones report to NERSA. This report sets out the process of developing regulatory guidelines and qualifying principles for the development of cogeneration projects in South Africa.
The development of the regulatory system should simplify the process for developing, evaluating and implementing cogeneration projects. Fieldstone’s report indicates that getting Eskom as a credit-worthy off taker to sign a standard PPA with aspiring cogeneration developers is key to the establishment of a viable cogeneration-industry. The pricing in the PPA will inter alia be based on the avoided costs of new generation in South Africa and it will take into account the expected cost of providing new electricity at a particular point, therefore also incorporating transmission and distribution costs. It is expected that Eskom will do their own calculation of avoided costs which will be proposed to Nersa. Nersa will make a final recommendation on what the avoided costs should be.
Eskom supports the initiative and has set itself a short-term target of buying at least 900 MW a year from cogeneration projects in the next five years. In the workshop the industry also indicated that the current under capacity in the South Africa electricity market should provide the impetus required to secure PPA’s for all economically viable generation projects in South Africa and establish a strong independent power producing industry.
Eskom will launch a pilot project in the next few months to gauge interest in local cogeneration opportunities. This pilot project will assess interest in cogeneration in South Africa, it will evaluate the ability of developers to deliver cogeneration projects, facilitate the bidding process and award PPA’s to successful bidders.
The presentations held at the workshop are attached.
Ecosecurities Co-generation Presentation on Carbon projects
Workshop presentation first half hour
Workshop presentation second half hour