By James Green, MD Ubersolar
As we enter into the 2020’s, the decade by 2030 will have proven to have seen an explosion in solar adoption and other renewables, making everything to date seem small.
Yet, it is surprising that there remains so little understanding by the public, both sophisticated and layman of the solar types of technologies at 2019, when at every turn renewables are being touted as one of, if not the most important energy source to counter climate change fossil fuel pollution.
Understanding today’s energy mix, and tomorrow’s is both complex and simple, with the realities being confused by the vested self-interest of the various sectors, pushing their individual agendas, motivated by profit, politics and of course corruption.
The Cheapest Energy Always Wins
History has proven that the cheapest energy will always win out in the end. Coal has dominated for over 200 years, basically since the steam engine in the mid 1770’s as designed by James Watt, powered by coal, kick started the industrial revolution.
Oil and gas gained traction in the late 1800’s as the motor car moved from steam to the combustion engine. Electric vehicles were preferred but the problems of battery storage killed the opportunity at that time. Rail transportation moved from steam engines to diesel and then to electric.
Generating electricity is still dominated by coal, with nuclear only really being preferred in France.
Coal today is still arguably cheaper than large scale renewables for generating electricity from power stations, that were written off years ago, and are now reaching their sell by date.
New coal power stations or nuclear however are much more expensive per kW generated than solar PV or wind energy.
The pendulum in favour of clean energy is swinging progressively on economic grounds.
Politics Overrides Practicality
It is of course political as well. In the case of South Africa the socialist love of trade unions, and the fear of job losses, dictates that coal will continue to play a major role, despite being the most expensive option.
In addition, the corrupt expensive extraction of coal, the transportation of it to power stations, the burning of low quality coal at inflated prices, has enriched the cadres of those in power, despite never being in the interest of public as a whole, as well as aggravating the health issues resulting from coal pollution. Renewables offer far fewer opportunities for personal enrichment.
As we move into the 2020’s large scale wind farms will continue to prove to be the cheapest renewable energy, producing kW’s at a much lower cost than new coal kW energy.
Likewise solar PV farms in South Africa are a complete no brainer in terms of cost per kWh with the continent’s abundant sunshine.
The killer for all electricity is that it is very difficult to store it. The only viable option is batteries.
The good news is the huge drive for electric vehicles based on reducing carbon emissions from diesel and petrol cars, is rapidly changing the battery market. Already huge peaking power battery farms have been built in the USA, China, Australia, and without doubt the next 20 years will see massive growth in battery storage.
This battery storage will overcome what is perceived to be the biggest shortcoming of renewable energy, being the reliability of supply, which is dependent on either the wind blowing or the sun shining. Instant power from batteries overcomes all these issues.
The combination of batteries and renewable energy generation will result in a shift in the energy mix in utility scale electricity production.
The politicians in South Africa however are constantly hedging their bets, supporting some utility scale renewables through the REIPPP programs, but at the same time still keeping coal in the equation in order to appease the unions.
Addressing the Energy Crisis
Today in 2019 South Africa faces an energy crisis. Load shedding or the fear of it is a constant impediment to economic progress in all sectors of business, mining and agriculture.
Ironically, ‘as Rome burns’ the answer and the solution is immediately available through renewables and the private sector in both business and domestic.
Within 5 years by 2025 South Africa could, if the political will was there, enjoy a reliable energy supply from renewables, with some supplementary peaking power from gas and even some coal.
As in most of Europe, solar PV could be installed by the private sector on rooftops, with excess power fed back into the grid, which would be purchased by Eskom, and resold at a profit, after wheeling charges for distribution. Financed by the banks, jobs would be created, new clean power generation would replace the old power stations.
It really is quite simple, and the arguments that the grid is not structured to cater for thousands of mini independent power producers rather than the 28 power stations of Eskom is a deliberate obstruction.
Will it happen this way and the answer is sadly a NO.
The ANC are stuck in the culture of socialist control, adverse to privatisation and particularly in the electricity sector. The unions of course are deliberately blind, to any form of privatisation, and in much the same ways as the coal workers in the UK and their unions in the 1970’s held a democratic government hostage, the story will play out in sub Saharan Africa in a similar manner. Economic growth will be stifled by socialism, trade union control and lack of backbone by government to put the country before political agenda.
What Renewable Options are Available to the Consumer
Despite the lovers of coal in South Africa, and Trump in the USA, the larger majority with a conscience are looking towards greener energies.
In Sub Saharan Africa solar water heaters in the domestic sector are a complete no brainer in respects of the financial return on investment, with paybacks as little as 20 months and typically under 36 months. As there are some7 million electric boilers (known as geysers) in SA alone, these all can be retrofitted with a solar conversion kit, thereby replacing up to 100% of the electricity normally used. Electrical back up convenience to guarantee hot water on rainy or inclement weather days means that there is no sacrifice of comfort. Over 40% of all electricity consumed in the domestic sector is attributable to water heating.
Solar electric or solar PV in the domestic sector is really a lifestyle investment. The financial returns are not great because of the need for battery storage. However, the convenience of avoiding the issues of load shedding, knowing that you will always have power for essential areas such as lighting, television and computers is difficult to quantify from a value perspective except on an individual level.
Solar PV in business, warehouses, factories and offices is, in much the same way as solar water heaters in homes or business a no brainer. Partially as a result of accelerated depreciation, VAT being recovered, the payback on grid tied systems (no battery storage) will typically range from 3,5 years to 6 years. Every installation will have unique characteristics but as the banks are keen to lend, generally it is possible with as little as a 10% deposit to borrow to fund the purchase and be cash flow positive every month from day 1.
There are also progressive moves for feed in arrangements where for example kWh generated over the weekends can be banked against kWh used on standard tariffs at other times during working weeks.
It is a start but a long way from encouraging the private sector to fund Southern Africa’s power generation with roof top solar PV, or allowing the private sector to build micro grids for rural communities, or even cluster developments in the cities.
As one moves progressively north from South Africa, the attraction of solar water heaters diminish, as the problem is not hot water, but keeping cool. Solar PV is a solution for air conditioning lighting and other equipment, but just as generating heat is energy intensive so is keeping cool.
So where does that leave us looking to the future?
Large scale renewables will fight their corner in competition to coal, maybe nuclear, and maybe gas.
Remember that the politicians are ignoring the climate crisis, and their love of coal is not driven by basic economics but fear of losing control. Socialist tendencies of trying to appease trade unions, an illogical fear of further job losses rather than reallocation, and a general refusal of accountability are symptomatic.
The private sector, whether they feed into the grid or not, will progressively embrace solar electric generation. Why? simply because it is a cheaper solution. Then, of course local government or national will really try to kill it off, as their reselling revenues of electricity will be falling, so new taxes will be introduced. Oh, how communism and socialism works to the detriment of a meritocracy and democracy.
Saving energy will continue to thrive, where solar thermal will replace electricity and water consumption used by Eskom.