Electricity + Control October 2015

ENERGY + ENVIROFICIENCY

• PV plants are costly and Return on Investment is slow. • The many issues relating to the connection of solar plants to the main grid have slowed the uptake of these solutions. • Addressing these challenges is key to harnessing the power of the sun as an alternate, sustainable energy source.

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power will doubtless have increased many times. It is these future differences in the cost of energy between the utility costs and the fixed solar PV cost that should be recognised as part of the long-term sustainability of owning such an asset. Additionally, in most cases the asset is attached to a building and would result in improved valuation of the building. Not only does this have a positive financial implica- tion, it also has an environmental implication, especially when one considers the Carbon Tax that will be levied as of 2016. The only way to negate the carbon tax is to either recycle or produce ‘Green kWh’ from a renewable source like solar PV. Solar PV loans In order to drive adoption of solar PV solutions, it is necessary for financial institutions to recognise their value and assist businesses and homeowners with funding these systems. Forward-thinking fi- nancial institutions should look to leverage the security of a loan for solar PV power against the asset itself, as it will pay for itself many times over in years to come. The asset could also be recognised as part of the building itself and be financed utilising an extension of the building bond. In addition, government needs to come on board by assisting financial institutions with tax rebates for their efforts in financing Solar PV systems. This is sound strategy, as by funding these systems, financial institutions are contributing to the overall reduction in carbon output and, more importantly, helping to resolv- ing the country’s current energy shortages. Connecting to utility In addition to funding, connecting to the utility remains a challenge. One of the most pressing issues is the nature of pure solar solutions (without energy storage capability), in that they are only able to produce energy during daylight hours, and the energymust be used or dumped. For the majority of residential applications where nobody is at home during the day, this generated power will be wasted if a solution to feed this power back into the grid cannot be resolved. Connection codes therefore need to be finalised, and metering for two-way energy flow needs to be implemented. It is also important to find a solution to the problem of optimising the use of all renewable energy generated to the advantage of both the end-user and the utility providers. Net metering The concept of net metering, whereby users sell their excess renew- able energy back to the utility for credit and utilise these credits when the renewable source experiences shortfall (such as at night when there is no sun to power solar PV systems) is one that has great potential to benefit all parties concerned. For most residential applications, this form of energy trading works well. Some utilities

may limit the amount of energy you can sell back for credits to the amount of utility energy used (i.e. if you use 2 000 kWh per month, than you may only sell back a maximum of 2 000 kWh per month). Another systemwould be to annualise this amount, enabling owners tomake better use of the credits throughout the year, such as in winter where generation may not match overall consumption. Feed-in tariffs Theoretically, users could manage consumption and generation of energy to a zero balance and not have to spend a cent on energy from the utility for the year. This idea in principle is appealing, particularly for consumers and business, however for utilities this could cause problems. If renewable energy customers are not paying what they used to pay for electricity, but rather supplementing their own power generation with utility power, how does the utility find revenue to pay for the maintenance of the generation, transmission and distribution network the entire systemuses? Feed in tariffs have been suggested as one solution to this problem, whereby the utility purchases the excess energy from providers, while users still purchase utility power, and there is no obligation to consume at the same rate as you sell energy. Conclusion Regardless of the challenges involved, solar PV remains the most viable and cost effective alternate energy source for South Africa, a country that experiences significant hours of sunshine for much of the year in the majority of its regions. If these problems can be sat- isfactorily resolved and solar becomes a mainstream power genera- tion source, not just for the utility but for business and homeowners too, the currently bleak power prospects of South Africa may have a brighter future after all.

Kevin Norris is the consulting solu- tions architect for Jasco Renewable Solutions.

Dave Smith is the managing director of Jasco Renewable Energy.

Enquiries: Email kevin.norris@jasco.co.za or dave.smith@jasco.co.za

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