Scope for SA mini hydro power real, but finite

South Africa has scope to build mini hydro plants to help power some communities but the potential is finite and will have been used within the next four to five years, an industry official said.

Anton-Louis Olivier, managing director of NuPlanet, the company behind a 7MW hydro project supplying the town of Bethlehem, said such plants are unlikely to contribute much to the country’s overall power supply, which is under great strain.

But they will help at the local level, with the 7M seen supplying up to 15% of Bethlehem’s power demand. The town, in the Free State, has about 70 000 people.

Olivier estimated South Africa had the potential to generate about 150MW in small hydro schemes, on top of the roughly 50MW that are being generated via such plants at the moment.

“The potential for small hydro in South Africa is real ... but in five years, all the small hydro power plants that you can build [here] will have been built,” he told said.

NuPlanet’s Bethlehem Hydro will switch on a 3MW hydro plant this week, while the other 4MW plant will be ready to be commissioned later this year.
They will be the country’s first new hydro plants in more than two decades.

“We’ve got the rights on a further 15MW and we are fairly comfortable that in about three to four years we will have some 50MW of small hydro under construction,” he said.

Small hydro projects have a capacity of up to 10 megawatts. They can involve small dams, pumps or water mills and because of their size they are considered to have a minimal environmental impact.

While South Africa does not have big rivers with constant flows like those found in some other Southern African countries, it can benefit from the fact that most of its water resources are captured in some form of water transfer scheme.

“Water transfer schemes put a lot of water in a specific place and in a quite predictable manner, and that’s very useful for small hydro,” Olivier said.

He said NuPlanet was able to raise the funds for the R100-million Bethlehem project via a loan from the Development Bank of South Africa and from equity partners.

Carbon credits
The introduction of new renewable energy tariffs earlier this year and the possibility of selling carbon credits were additional factors that made the project economically viable.

The renewable energy feed-in tariff, which will pay 94 cents for each kilowatt hour produced from hydro, covers the cost of generation and allows for a reasonable profit to induce developers to invest in renewable energy.

“That changes the viability of projects like this immensely ... it creates a great situation for small developers to have a guaranteed rate at a level which is designed to be attractive to make these projects work,” Olivier said.

NuPlanet is getting additional income by selling carbon credits to Norway’s state utility.

Olivier said the Bethlehem project would mitigate about 40 000 tonnes of carbon dioxide emissions a year. - Reuters

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