Distributed generation: ‘attractive power alternative’

*Sources of renewable energy.

17 March 2017, Sweetcrude, Johannesburg — While the proliferation of large-scale energy projects in Africa is positive, growing worldwide interest in sustainability and renewable energy highlights the need to also actively pursue other low-cost, fast-track energy solutions that will add MW and benefit the 600+ million sub-Saharan Africans who still do not have access to electricity.

To achieve the development of a more balanced power portfolios, African cities are taking power generation into their own hands. Through a series of incentives, households are being encouraged to install small-scale embedded generation technology (SSEG) for access during off-peak hours, feeding excess power back to the grid.

The tangible benefits of rooftop projects must be aligned with required investments in order to widely provide power to rural communities and industries.

Distributed generation – an approach to generating power at the site of consumption – has the potential to fill immediate energy gaps by supplying on-site energy for businesses and communities while offering reliability, resilience and an economical model. To provide the most impact and least financial risk, implementers should take a holistic programmatic approach. An integrated strategy will ensure a sustained, functional lifespan with unabated energy delivery.

Shifting Africa’s appetite for mobile into power
Africa’s rapid adoption of mobile technology suggests that distributed generation technology could be rapidly embraced in a similar fashion. The demand for, and subsequent deployment of, mobile technology seemingly skipped traditional large-scale landline telecommunications infrastructure build out. Distributed energy resources (DERs) could echo this trend as they are also significantly smaller scale compared to baseload projects.

Already in use in certain parts of the U.S., U.K. and Asia-Pacific countries, distributed generation is fast gaining traction and could potentially transform the power market globally.

To some extent, distributed generation systems are making inroads into Africa, with early achievements. Mali thus far has been the most successful by installing over 200 isolated diesel power distribution grids; while Kenya and Tanzania implemented solar home systems that use customer financing and a ‘pay-as-you-go’ approach through mobile payments.

Closer to home, off-grid solar systems are being installed at 1,700 rural households in the Mbhashe Municipality in the Eastern Cape, South Africa. These have been approached using economies of scale – and a more comprehensive methodology than simply just adding rooftop solar – and there is still room to expand, particularly throughout Sub-Saharan Africa, and with high energy users such as Nigeria, Ethiopia, Cote d’Ivoire and the Democratic Republic of Congo.

Distributed generation often works hand-in-hand with microgrids. As integrated systems of multiple generation sources, such as solar PV (photovoltaic), diesel or natural gas-fuelled generators and battery storage systems, microgrids ensure a clean and well-managed power supply even during cloudy weather or at night.

While the biggest challenge for distributed generation is storage, there are several solutions already available. Battery energy storage is a good alternative and complements usage during peak times to lower power bills. It is also an excellent resource for smoothing fluctuations in production from intermittent renewable energy generators such as a wind or solar PV and an alternative to burning natural gas or diesel fuel to address renewable power variations.

Battery system performance is improving and prices are becoming more economical as global production of lithium ion batteries increases.

Creating the business case
The key to unlocking growth in distributed generation is to develop compelling business models that benefit energy consumers, utilities, communities and investors alike. As with any new application, this appears to be a common challenge facing early adopters.

In the United States and Canada, public-private partnerships are allowing communities to benefit from DER or microgrid programmes with limited or no capital investment, while utilities and investors are able to realise financial returns on their investments.

Developing and applying the right structure requires diligent planning, including the development of the technical solution and business model together to ensure long-term economic and reliable power solutions. Our experience has also shown us that long-term success does not end at installation. An integrated strategy should also include maintenance through remote monitoring and diagnostics.

Speeding Energy to Communities
Specific to cost and schedule, particularly when considering baseload solutions, distributed generation and microgrid solutions are poised to immediately address local power needs.

It can take up to a year for a large microgrid programme to come online, compared to the 36-70 months for large central station and transmission projects. The cost and schedule advantages of small DER systems are beneficial for regions requiring capital and experiencing project delivery and schedule delays.

Continued distribution energy growth throughout Africa will complement ongoing traditional power generation projects and bring much-needed power to remote locations, support critical facilities, and help the continent to create low carbon energy solutions.

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