South Africa’s current energy crises resulting in up to 6 hours of blackouts (the term load shedding is misleading) on any given day has everyone’s attention.
In this post I would like to focus on one opportunity that is not yet getting traction in our country but has been fairly commonplace in developed countries around the world for several decades.
Net Metering is a fairly simple idea: it is generally an arrangement with a service provider whereby excess electricity generated by a customer who has installed their own solar/wind/other electricity generating technology is used to offset electric energy provided by the electric utility to the electric consumer during the applicable billing period.
For example, this system has enabled German citizens to build and own nearly half of all the wind turbines, solar PV, and biogas plants in the country. Individual German citizens—not their utility companies–have invested more than $100 billion in renewable energy. They have done so because they are paid a fair price for their electricity and because they can install the size, type, and amount of renewables that is the most economic for them and the best fit for their communities. energyblog.nationalgeographic.com
This model appears to be a ‘no-brainer’ in its potential to incentivise property owners who can easily calculate a faster return on an investment in alternative energy while contributing to a greener planet. A document recently released by NERSA (National Energy Regulator South Africa) has pointed out:
MECHANISMS should be developed to allow the integration of electricity generation by solar panels on residential, commercial and industrial buildings into the power grid.
Nersa’s document comes during what it says has been a great increase over the past year in the number of private rooftop photovoltaic (solar) panels installed on residential and commercial/ industrial premises at the cost of the owners. These are connected to the grid and could feed surplus power back into it.
The owners of a number of rooftop grid-tied solar systems have agreements with municipalities on net-metering, which sets off the electricity consumed with the surplus electricity supplied to the grid. The Gorgeous Green House has signed such an agreement with our local municipality but are yet to see any credit for surplus electricity. The Mercury Newspaper and IOL have been covering aspects of this story and approached eThekwini for comment as to why the process has not been implemented. The full story can be accessed here. Leshan Moddliar from eThewini’s response was:
“Currently, the municipality is not ideally structured to remunerate renewable small scale embedded generation, as processes are designed to buy power from Eskom and supply customers. When a customer wants to generate electricity, power is now flowing in the reverse direction and it does pose a challenge to integrate to current systems.”
One can’t help wondering why this ‘structuring’ is taking so long to sort out. We signed our Power Purchase Agreement in October 2013. Perhaps the real reason is as the NERSA document points out:
“The widespread installation of rooftop solar panels, which is also referred to as embedded generation or distributed generation, poses a real threat to municipal and Eskom revenues,”
My follow up questions for Leshan are as follows:
- What has eThekwini/NERSA/ESKOM been doing in the last few years to address the structural issues that are preventing the implementation of our PPA?
- Why is it that other municipalities have pilot projects running and NERSA are not inhibiting them?
- What is eThekwini/NERSA/ESKOM doing to learn from these models and other successful projects around the world?
- To what extent is eThekwini prioritising this opportunity in light of the energy crises?
- What are you time lines?
- What is your comment in terms of the NERSA document (quote above). Is it possible your reluctance to move these projects forward is because it poses a threat to your revenues?
Unfortunately, several e-mails and messages left for Leshan have elicited no response.