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Namibian IPP offering 120MW supply to Eskom

2020-02-03  Staff Reporter

Namibian IPP offering 120MW supply to Eskom
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WINDHOEK - Namibian independent power producer Arandis Power says it is offering the South African utility Eskom 120MW of flexible power generation capacity within the framework of the Request for Information (RFI) that was issued on 13 December 2019 by the South African Department of Mineral Resources and Energy in respect of a “Risk Mitigation Power Procurement Programme”. 

The South African Department of Mineral Resources and Eskom have identified there is a power generation gap in South Africa of 4000MW in the short to medium-term and propose 2000MW of this to be supplied from dispatchable power sources, comparable to that offered by Arandis Power from Namibia. 
The opportunity for this cross-border supply has been made possible by the new enabling Modified Single Buyer model regulations that came into being in Namibia on 1 September 2019. 

“Namibia’s electricity regulatory authority, the ECB (Electricity Control Board), has shown vision and leadership in the Southern African Power Pool region by opening up the local market and the national grid to independent power producers (IPPs) for the generation and trading of electricity – both locally and internationally. This new and unprecedented market framework for the SADC region allows Arandis Power to offer competitively priced thermal generation to Eskom,” read statement by Arandis Power.  

Last year (2019) proved to be South Africa’s worst year for load-shedding. According to the South African authorities, Eskom was forced to load-shed 530 hours for a total amount of 1352 gigawatt-hours, with up to Stage 6 load shedding being implemented. This has had a negative economic impact on the South African economy, quantified between R60 billion and R120 billion. 

The bad news is that the South Africa’s Scientific and Industrial Research authority predicts that load-shedding is expected to continue for at least the next two to three years, depending on key decisions and actions that are taken or not. 

According to SA experts, the Energy Availability Factor (EAF), which is the availability of the power stations to generate electricity, will be at least 10% lower than the 75% forecast predicted by Eskom. This means energy shortages are totally unavoidable and South Africa once again commenced load-shedding on Thursday 30th January. It is unimaginable that Eskom’s woes will have no effect on Namibia or the region – both in terms of tariff increases and availability of supply.

According to the statement by Arandis Power, its 120MW project, powered by low sulphur Heavy Fuel Oil, is fully developed and funded. The project has also registered interest in its financing from the Standard Bank group in Namibia and South Africa, the Development Bank of Namibia, the Development Bank of Southern Africa and by Stanlib Asset Management.

Read the statement: “The Arandis Power plant is capable of supplying cost-effective power in a flexible operational mode, from peaking to baseload energy. This operational flexibility, more competitive than Eskom’s diesel driven OCGT peaking plants, caters for unlimited starts and stops, and makes the plant an enabler of renewable energy projects in that it contributes, through its flexible operational capability (load following, voltage and frequency regulation) to compensate grid instability challenges created by intermittent solar PV and wind generators”. 

Arandis Power’s statement added that ground-breaking for the project could take place within four months of signing a Power Purchase Agreement with Eskom or any other off-taker in the Southern African Power Pool region. 

2020-02-03  Staff Reporter

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