Understanding the cost of electricity from Medupi, Kusile and IPPs

Chris Yelland, Engineering News, 22 July, 2016.

In order to understand and compare the cost of electricity from a power plant, whether it is coal-fired, nuclear, hydro, gas, wind or solar, one needs to look further than simply the capital, fuel or operating and maintenance costs in isolation, to a concept known as the “levelised cost of electricity” over the lifetime of the plant. By CHRIS YELLAND.

The levelised cost of electricity (LCOE) from a generation plant is the net present-day monetary cost per present day kWh unit of electricity delivered, which when adjusted for inflation each year over the lifetime of the plant, will recover its full costs, including the initial investment, cost of capital (including dividends and interest), fuel and all other fixed and variable operating and maintenance costs…

LCOE from renewable energy IPPs

In contrast to the LCOE calculated for Medupi and Kusile of R1,05/kWh and R1,19/kWh (above), the fully indexed average price per kWh (inflated to base date May 2016) actually being paid by Eskom for renewable energy procured from IPPs in terms of 20-year power purchase agreements, was presented by the IPP Office of the SA Department of Energy on 16 April 2015 as:

Average price paid by Eskom Bid Window 1 Bid Window 2 Bid Window 3 Bid Window 4
Wind R1,52/kWh R1,19/kWh R0,87/kWh R0,69/kWh
Solar PV R3,66/kWh R2,18/kWh R1,17/kWh R0,87/kWh
CSP R3,56/kWh R3,33/kWh R3,31/kWh1 R3,09/kWh1, 2


Here is the full article

Elon Musk hits the road with his master plan – Go, Elon, Go!

BDLive, 21 July, 2016.

DETROIT — On Wednesday, Tesla Motors CEO Elon Musk unveiled an ambitious plan to expand the company into electric trucks and buses, car sharing and solar energy systems.

In a blog post titled “Master Plan, Part Deux”, Musk sketched a vision of an integrated carbon-free energy enterprise offering a wider range of vehicles, and products and services beyond electric cars and batteries.

The newest elements of the strategy included plans to develop car-and ride-sharing programmes, as well as commercial vehicles — businesses where other companies already compete, and in some cases have ample head starts on Tesla…

Click here for this view of the future!

SA’s power lies in breaking up Eskom’s monopoly model

BDLive, Anton Eberhard, 21 July 2016.

THE chairman of Eskom’s board has written to the energy minister, stating that Eskom will not sign any further power purchase agreements with independent power producers (IPPs) after the current round of renewable energy projects are concluded. The potential consequences could be devastating for private investment in SA’s power sector, and could terminate the government’s most successful public-private procurement programme…

…Eskom argues, misleadingly, that IPPs are too expensive. It quotes first-generation IPP costs and ignores the extraordinary fall in contracted renewable energy prices — more than 70% for solar photovoltaics and almost 50% for wind energy…

…What we need now is a separate state-owned electricity market and transmission operator that takes care of electricity planning, power procurement and contracting, system operation and balancing, and transmission. Let’s call it Gridco. This obviously needs to be independent of Eskom generation and IPPs, so it can procure power at the least cost….

…It is not naïve to believe SA’s electricity sector can, and will, be restructured. I’ve seen it happen in many countries. Perhaps, SA’s fiscal position will have to deteriorate further before we accept we can no longer fully fund our public utilities — we’ve pumped R83bn into Eskom since 2008 — and that a greater openness to private investment is inevitable. It would be better to start that reform process now, before we are once again in crisis….

Here is the full article – a must read!!!


Rocky Mountain Institute, 2 June, 2016.

RMI CEO Jules Kortenhorst interviews Tom Dinwoodie, executive producer of Time to Choose, a new movie about the threats of climate change and the stories of people working on the frontlines to address this global challenge. The film opens June 3 across the country (USA, that is).

Read More

And see the review here (extract shown below).

“Anyone who spends enough time watching activist, agitprop “issue documentaries” should be familiar with that “Welp!” feeling. After spending an hour or so hearing about how corporations have stacked the deck against the working class, and how we’re running out of potable water, and how everything from obesity to oil spills to debt to antibiotic-resistant superbugs will inevitably kill us all, the best viewers can do is throw their hands in the air, say “Welp!,” and then go out and spend money they don’t have to get dangerously hammered and gorge on poisonous junk food—because there’s apparently no reason to try to fix anything.

Charles Ferguson’s documentaries don’t incline toward despair. In his No End In Sight (about the logistical fiasco of the Iraq War) and his Oscar-winning Inside Job(detailing exactly what led to the financial crisis of 2008), Ferguson tells stories from our shared recent history with not only a definite political slant but also an evenhandedness that expresses an uncommon faith in human agency. His films suggest that catastrophes aren’t unstoppable but are the result of bad choices made by people who should know better—and who could thus avoid making those mistakes again. That sense of backhanded optimism sets Ferguson’s Time To Choose apart from the countless other documentaries about climate change. It isn’t a brilliant piece of filmmaking or even a revelatory work of journalism. ButTime To Choose may provoke actual action, if only because it doesn’t conclude that we’re doomed.”

New solar solution on offer for sectional-title market

Renewable energy services company SolarAfrica has launched a new rooftop solar solution, tailored specifically for South Africa’s large sectional-title market. The offering is designed to provide homeowners in complexes and estates with immediate access to affordable solar energy without having to p…