South African miners plan R60 billion of power projects

[Jan]

Mines could spend R60 billion to fight load-shedding

South African mining companies could spend R60 billion on renewable energy projects, helping to ease the country’s electricity supply crisis.

 

[TheMightyQuinn]

South African miners plan R60 billion of power projects

That headline nearly gave me brain cancer FFS...

 

[system32]

The mines will be saving money by going off-grid.

Typical ROI period for PV + Inverter + Batteries is ~7 years for home users.
ROI period for RE for companies is even less:

1. SARS accelerated asset depreciation for RE
2. Business electricity rates are much higher than home users
3. Reduced carbon tax
4. No losses/down time due to load shedding

So it's a good business decision.

Consumers unfortunately pay full price for solar equipment with no rebates, no tax incentives, no nothing :-(

When you factor in that Eskom wants 20% more next year the ROI period will be even less.

Eskom wants 20% more next year

Not interested in Nersa’s four options.

www.moneyweb.co.za

According to my CoJ pre-paid purchases:

• 8% increase in 2018
• 20% increase in 2019
• 10% increase in 2020
• 18% increase in 2021
• ~20% increase in 2022 (see Moneyweb)

This is higher than the CoJ advertised increases due to bracket creep and CoJ reduced the number of brackets.

It's fundamentally a good business decision which they need to make to remain competitive.

 

[itareanlnotani]

The mines will be saving money by going off-grid.

Typical ROI period for PV + Inverter + Batteries is ~7 years for home users.
ROI period for RE for companies is even less:

1. SARS accelerated asset depreciation for RE
2. Business electricity rates are much higher than home users
3. Reduced carbon tax
4. No losses/down time due to load shedding

So it's a good business decision.

Consumers unfortunately pay full price for solar equipment with no rebates, no tax incentives, no nothing :-(

When you factor in that Eskom wants 20% more next year the ROI period will be even less.

Eskom wants 20% more next year

Not interested in Nersa’s four options.

www.moneyweb.co.za

According to my CoJ pre-paid purchases:

• 8% increase in 2018
• 20% increase in 2019
• 10% increase in 2020
• 18% increase in 2021
• ~20% increase in 2022 (see Moneyweb)

This is higher than the CoJ advertised increases due to bracket creep and CoJ reduced the number of brackets.

It's fundamentally a good business decision which they need to make to remain competitive.

I doubt they'll be going offgrid.

They will be substantially reducing their usage though.
This is good in some ways, and bad in others.

Good - in that load is reduced on the grid - 4GW is a decent amount - 10% of our alleged grid capacity offloaded elsewhere.

Bad - in that its a massive amount of money for Eskom to be losing. Commercial usage is paid usage. As opposed to Residential, which for Eskom is not. See Soweto, Muni's et al for examples of why.

Death spiral, onward and upward!

 

[Lupus]

I doubt they'll be going offgrid.

They will be substantially reducing their usage though.
This is good in some ways, and bad in others.

Good - in that load is reduced on the grid - 4GW is a decent amount - 10% of our alleged grid capacity offloaded elsewhere.

Bad - in that its a massive amount of money for Eskom to be losing. Commercial usage is paid usage. As opposed to Residential, which for Eskom is not. See Soweto, Muni's et al for examples of why.

Death spiral, onward and upward!

Well they do pay massively smaller amounts then the consumers. The 4GW off the grid may actually outweigh that, who knows, by allowing South Africa to recover from load shedding which costs billions.

 

[wingnut771]

..

Bad - in that its a massive amount of money for Eskom to be losing. Commercial usage is paid usage. As opposed to Residential, which for Eskom is not. See Soweto, Muni's et al for examples of why.

Death spiral, onward and upward!

No problem. Increase prices 20%.

 

[Johnatan56]

The mines will be saving money by going off-grid.

Typical ROI period for PV + Inverter + Batteries is ~7 years for home users.
ROI period for RE for companies is even less:

1. SARS accelerated asset depreciation for RE
2. Business electricity rates are much higher than home users

Would depend on the mine, think it was a case of quite a few of them getting electricity at/below cost, depending on when contract was negotiated, who was involved, etc.
For the mines that are actually paying full price, this is going to be a no-brainer, but they will not go off-grid, will be hybrid with always take solar/wind if possible and then Eskom when needed, since they will not have the large area options for renewable and their equipment often enough will probably be bursts of high draw at times.

 

[ToxicBunny]

I doubt they'll be going offgrid.

They will be substantially reducing their usage though.
This is good in some ways, and bad in others.

Good - in that load is reduced on the grid - 4GW is a decent amount - 10% of our alleged grid capacity offloaded elsewhere.

Bad - in that its a massive amount of money for Eskom to be losing. Commercial usage is paid usage. As opposed to Residential, which for Eskom is not. See Soweto, Muni's et al for examples of why.

Death spiral, onward and upward!

I think its a double edged sword really.

Eskom theoretically makes more from residential customers (possibly even those who are billed by the municipalities directly), but losing the 4GW would potentially free up the grid to reduce load shedding so Eskom can then "make that money" that it loses from load shedding. But as you say, residential customers are a trickier beast and the revenue is less predictable and obviously at less scale so you need more customers to make up for that loss.

 

[ShaunSA]

That headline nearly gave me brain cancer FFS...

I thought the zama zama's were coming to our rescue

 

[Mystic Twilight]

I doubt they'll be going offgrid.

They will be substantially reducing their usage though.
This is good in some ways, and bad in others.

Good - in that load is reduced on the grid - 4GW is a decent amount - 10% of our alleged grid capacity offloaded elsewhere.

Bad - in that its a massive amount of money for Eskom to be losing. Commercial usage is paid usage. As opposed to Residential, which for Eskom is not. See Soweto, Muni's et al for examples of why.

Death spiral, onward and upward!

It's not impossible for them to go off grid, if mines are able to tap into geothermal power and have a licensing/permission to build a power station then they can go off grid permanently.

 

[cr@zydude]

The mines will be saving money by going off-grid.

Typical ROI period for PV + Inverter + Batteries is ~7 years for home users.
ROI period for RE for companies is even less:

1. SARS accelerated asset depreciation for RE
2. Business electricity rates are much higher than home users
3. Reduced carbon tax
4. No losses/down time due to load shedding

So it's a good business decision.

Consumers unfortunately pay full price for solar equipment with no rebates, no tax incentives, no nothing :-(

When you factor in that Eskom wants 20% more next year the ROI period will be even less.

Eskom wants 20% more next year

Not interested in Nersa’s four options.

www.moneyweb.co.za

According to my CoJ pre-paid purchases:

• 8% increase in 2018
• 20% increase in 2019
• 10% increase in 2020
• 18% increase in 2021
• ~20% increase in 2022 (see Moneyweb)

This is higher than the CoJ advertised increases due to bracket creep and CoJ reduced the number of brackets.

It's fundamentally a good business decision which they need to make to remain competitive.

From what I have seen mines generally pay less per kWh than households.

 

[JustAsk]

From what I have seen mines generally pay less per kWh than households.

Almost like 50% less...don't know where he is getting his info from. Mines usually are direct Eskom clients, many at special industry rates. Mines will never go offgrid. This "could be" power projects are most probably just to power lights.

I was 2 weeks ago at a mine with a solar setup that only powers the lights, cctv and the security office at the gate...even the microwave of security.

 

[Not_original]

Almost like 50% less...don't know where he is getting his info from. Mines usually are direct Eskom clients, many at special industry rates

They sure do. Imagine a place like a petrochemical factory that eats MW's just to keep all the lights burning having to pay resi rates. My little corner alone has a 65 MW load on average

 

[The_Librarian]

It's not impossible for them to go off grid, if mines are able to tap into geothermal power and have a licensing/permission to build a power station then they can go off grid permanently.

Was thinking about that the other day - especially with the deep mines and it's getting really hot down there.

So all they'll need then is to make a plan to go the last mile, and somehow pipe that energy up/down/wherever they need it to go.

 

[Mystic Twilight]

Was thinking about that the other day - especially with the deep mines and it's getting really hot down there.

So all they'll need then is to make a plan to go the last mile, and somehow pipe that energy up/down/wherever they need it to go.

Take this one step further and convert [old] mines into new power stations to power the country, don't need new coal mines over gwedes [dead] body.

 

[RaptorSA]

Bad - in that its a massive amount of money for Eskom to be losing.

Not at all.
If you rename it to Eksom then Eskom doesn't lose a cent.



#VoteRaptorSA_2024

 

[itareanlnotani]

I think its a double edged sword really.

Eskom theoretically makes more from residential customers (possibly even those who are billed by the municipalities directly), but losing the 4GW would potentially free up the grid to reduce load shedding so Eskom can then "make that money" that it loses from load shedding. But as you say, residential customers are a trickier beast and the revenue is less predictable and obviously at less scale so you need more customers to make up for that loss.

At the end of the day, its a net win for the country.

Less pollution. Less load shedding.
More short, and medium term pain for Eskom though.
Death Spiral - costs increase, customers decrease, rinse/repeat...

Eskom electricity is already overpriced - especially in comparison to self generation.

So yes, a double edged sword.

20 years ago very few people, would dream of running their own power stations. Now it's simple and cheap to do so even at a household level...

 

[konfab]

It's not impossible for them to go off grid, if mines are able to tap into geothermal power and have a licensing/permission to build a power station then they can go off grid permanently.

I was about to blast you into oblivion for that comment, because mines are usually placed in areas that are specifically bad for geothemal plants (low thermal gradients). The temp at the bottom of the deep mines is about 70 degrees, is too low for normal plants (they need 180 degrees)

However during my research, I found these plants called binary cycle plants that utilise another working fluid with a boiling point lower than water, which means they can take advantages of lower temperatures.

A binary cycle (also binary vapor cycle) in thermodynamics is a power generation method that uses two circuits, high temperature one and lower temperature one.[1] When used in a geothermal power plant, this allows for cooler geothermal reservoirs to be used than the 182 °C (360 °F) which is required for dry steam and flash steam plants.[2]

A binary cycle geothermal power plants first has two circuits; the first uses pumps to draw hot water from a geothermal well through a heat exchanger before returning it to the underground reservoir at a lower temperature. A second circuit uses a "working" or "binary" fluid with a low boiling point, typically a butane or pentane hydrocarbon, which is pumped at fairly high pressure (500 psi (3.4 MPa))[citation needed] through the heat exchanger, where it is vaporized and then directed at a higher pressure through a turbine. On exiting the turbine it then passes through cold air radiators or cold water which results in a substantial drop in pressure and temperature before it cycles back to the heat exchanger.[3]

https://en.wikipedia.org/wiki/Binary_cycle

One of the issues is that their existing systems work by sending cold water or ice down to the bottom of the mine, then they pump up the tepid water to cool again. Its objective is to never let the temperature of the mine go higher than a certain amount, which will decrease the thermal efficiency of any geothermal system you want to install there.

It might work for a mine that isn't profitable anymore, where they don't have to worry about keeping it at safe temperatures.

 

[ToxicBunny]

At the end of the day, its a net win for the country.

Less pollution. Less load shedding.
More short, and medium term pain for Eskom though.
Death Spiral - costs increase, customers decrease, rinse/repeat...

Eskom electricity is already overpriced - especially in comparison to self generation.

So yes, a double edged sword.

20 years ago very few people, would dream of running their own power stations. Now it's simple and cheap to do so even at a household level...

Very much so.

The whole world is going from this big massive scale grid with huge centralised power generation, to a massive grid with micro generation effectively (yes I know its way more complex than that, and will always be a hybrid in reality, but still)

Transmission and Distribution are going to become the key enablers and generation will sort of "fade" into the background to some degree.

 

[The_Librarian]

The whole world is going from this big massive scale grid with huge centralised power generation, to a massive grid with micro generation effectively (yes I know its way more complex than that, and will always be a hybrid in reality, but still)

Transmission and Distribution are going to become the key enablers and generation will sort of "fade" into the background to some degree.

And Mantashe won't see it until it's too late...