South Africa Wind Energy Barriers

Magisterarbeit von Richard Ganter

Introduction:

The rapid adoption of wind energy in the renewable energy mix can be seen in many industrialized nations in the past decade, ‘in particular the need to agreed greenhouse gas reduction and stable energy supply are seen as a sound vision for a sustainable energy policy’. In an emerging market such as South Africa there are abundant renewable resources including wind energy, however there is low adoption observed to date.

This study aims to investigate barriers to entry in the South African wind energy sector and what the priorities are to remove such barriers for successful deployment of wind technology.

Therefore, it was required to examine successful deployment of wind energy in the European Union and how such barriers were removed; this was set in the current status of the renewable energy sector and existing barriers in South Africa. It was necessary to gain insight of the inter-related issues on opening a traditional fossil fuel based energy market to a transitional implementation of renewable energy provisioning, also considering the current utility monopoly based energy landscape in South Africa.

Chapter one considers the global shift for the need to implement renewable energy and highlights key issues such as security of supply, carbon reduction linked to climate change. Section three looks at the global benefits of renewable energy within the energy mix. Section four highlights key policy shifts and wind energy potential and section five gives an overview of South Africa’s renewable energy policies.

Chapter two looks at the research question of the need to answer what barriers exist and how to remove these in South Africa. Section three and four describe the qualitative research method applied and the setting of sampling. Section five, six and seven look at the tools used for telephone interviews. Section eight and nine describe the literary research applied, the key institutional papers reviewed and barriers identified.

Chapter three describes the lessons learned in a global context on policies for renewable energy to deploy wind energy successfully. Section three looks at the background on European lessons learned with key European wind markets focused on such as Denmark, Germany, Spain and UK.

Sections four to thirteen look at the barriers to entry, key mechanism such as feed-in tariffs, tendering, effectiveness of support schemes in various EU markets and conclusion on support schemes.

Sections fourteen to twenty two look at specific barriers to entry, offshore, grid access, distribution, socio-economic effects, public and environmental issues with conclusion on removal of barriers.

Chapter four sections one to three look at the energy mix, policy status and wind potential in South Africa. Sections four and five look at current support mechanisms and provincial initiatives. Sections six to eight describe distribution and small scale wind barriers and socio-economic considerations. Section nine and ten look at non implementation at regulatory and legal level, issues on power purchase agreements, and inconsistencies in integrated resource planning.

Chapter five looks at the survey methods used the raw data analysis and limitations of the survey.

Chapter six looks at the qualitative findings in South Africa. Section two to six describes the analysis is themed on successful initiatives, unsuccessful measures, barriers to entry, on priorities to remove barriers.

Chapter seven presents the discussion based on the results.

Chapter eight draws conclusions and chapter nine recommends and identifies further areas of research.

Table of Contents:

	Abstract	3
	Acknowledgements	5
	List of Abbreviations	8
	List of Illustrations	9
	Introduction	9
	Background and aims of study	10
1.1.1	Reasons for renewable energy in a world context	12
1.2	Global lessons on barriers to renewable energy	12
1.3	Global benefits of renewables in the energy mix	14
1.4	South Africa's Emissions	15
1.5	Scaling up wind energy	17
1.6	South Africa's wind energy potential	18
2.	Research Question	20
2.1	Research objective	20
2.2	Research method	20
2.3	Qualitative research method	20
2.4	Defining the qualitative research setting: Sampling	21
2.5	Method & Tools	21
2.6	Questionnaires	22
2.7	Stakeholder interviews	22
2.8	Literary research outline	22
2.9	Academic sources	23
3.	Lessons from Europe	24
3.1	Lessons from Europe background	24
3.2	Barriers to entry	25
3.3	Support mechanisms	26
3.4	Regional harmonisation of support schemes	26
3.5	Tendering	26
3.6	Feed-in Tariffs	27
3.7	Fiscal mechanisms overview	27
3.8	Evaluation of specific support schemes	29
3.9	Effectiveness of support mechanisms	29
3.10	Effective mechanism in key wind markets in Europe	31
3.11	Conclusion on EU support mechanisms	32
3.12	Exploring barriers to entry	33
3.13	Gale force offshore barriers	33
3.14	Grid access	34
3.15	Smart grid and decentralized electricity	34
3.16	Renewable energy and socio economic effects	35
3.17	Public acceptance and property	35
3.18	Environmental impact assessment	36
3.19	Adverse Effects: Noise, visual and electromagnetic impact	36
3.20	Conclusion on removal of barriers	37
4	Energy Landscape in South Africa	38
4.1	Background	38
4.2	Renewable energy policy status	40
4.3	Barriers to wind energy in South Africa	41
4.4	Eskom and renewable energy sector	42
4.5	Barriers - Mapping the wind potential	43
4.6	Support mechanisms for removal of barriers	45
4.7	Provincial and local Initiatives	47
4.8	Distribution and decentralized Energy	48
4.9	Small scale wind	49
4.10	Renewable energy and socio-economic Impact	50
4.11	Measures remaining to remove existing barriers	51
4.12	Slowly off the mark – Refit	53
4.13	Priorities for removal	53
5.1	Survey Methods	54
5.2	Data analysis	54
5.3	Stakeholders interviewed	55
5.4	Limitations	56
6.1	Qualitative Findings	57
6.2	On current status of the South African RE sector	57
6.3	On successful support initiatives for renewable energy	58
6.4	On unsuccessful measures	59
6.5	On barriers to entry	60
6.6	On removal of barriers	61
6.7	On priorities to remove barriers	61
7.1	Discussion	63
7.2	Institutional and administration barriers	63
7.3	A question of liberalization	63
7.4	Market transformation	65
7.5	RE tradable certificates	66
7.6	Grid access	66
7.7	Issues of rising land prices	67
7.8	Skills transfer and training	67
8.	Conclusion	67
9.	Recommendations, Research and Development	69
Appendix 1	Energy from Wind	70
Appendix 2	Historical Overview of Promotion Strategies in European Countries	73
Appendix 3	Inventory of Current Support Systems	74
Appendix 4	Questionnaire Example	78
Appendix 5	Summary Research Results from Coded Analysis	79
	References	80

Text Sample:

Chapter 3.15, Smart Grid and Decentralised Electricity:

The further liberalisation of the energy markets in Europe has made decentralised energy (DE) more feasible as seen in the RE sector in Germany.

A combination of RE sources and more cost effective control can balance out short-term fluctuations. Providing reliable electricity from 100 percent RE sources is shown in the combined power plant (CPP) projects linking 36 wind, solar biomass and hydropower installations throughout Germany.

This follows, the World Alliance for Decentralized Energy claims that potential for DE in realizing electrification objectives is great anda far cheaper method of supplying power to local areas than grid extension including environmental benefits. Denmark for example benefits from a fifty percent shift to DE such as in case of wind turbines placed along transmission corridors, highways or train tracks.

DE could therefore be of importance in the context of this investigation on support strategies in rural community electrification programmes in South Africa and improving energy efficiency.

A wide range of technologies are available from the RE sector to benefit local ownership. However, barriers remain in the EU where it is recognised that inadequate progress has been made on lighter procedures for small projects implementation at local ownership level.

The introduction of digital technology could present a further opportunity in form of the smart grid which allows more-efficient use of existing power capacity and of transmission and distribution, in addition to better handling of fluctuations in energy from wind and sun.

Renewable Energyand Socio Economic Effects:

The adoption by the European Council of the Renewable Energy Directive for 2020 sets ambitious targets for each Member State to achieve a twenty percent share of RE.

In a study the EU investigated the macro- economic gross effects and net effects of RE policies in Europe, more specifically the findings suggest that the RE sector is already a very important one in terms of employment and value add. ‘An estimated 2.8 million jobs by 2020 and 3.4 by 2030 will be created’.As a result of the RE support policies, the positive investment effect is currently based on installations in Europe and exports globally. However, it is recognized that inherent uncertainties about the future support of RE sources exist.

In this context in the UK, the employment opportunities had been hitherto significantly underestimated. It is claimed an additional ‘130,000 jobs in the wind sectorby 2020 are a possibility’.

Contrary to the report which claims that from a current 5000 jobs in the wind, wave and tidal energy sector, an increase to as many as 60,000 employees by 2020. However, the report suggests ‘ that the UK does not yet have a coherent approach to training’ and step changes are required to achieve this goal.

Whilst in Germany, the wind energy industry now employs close to 100,000 people.

Public Acceptance and Property:

In terms of property or land prices near wind farms, there appears to be conflicting and subjective evidence. A Canadian study noted that buying decisions are effected by different criteria’s near wind farms such as some people finding it interesting and others do not like the look. (Wind farms and Land Values 2003 p.1) In further studies in the UK 60 percent of respondents in a Royal Institute of Chartered Surveyors survey experienced negative impact on house prices. However, the EWEA observes the social acceptance of wind farms depends on the way they are developed and managed. This also means authorities learn from past experience and find mechanisms to maintain and expand public engagement in wind development.

Environmental Impact Assessments:

The European Directive on Environmental Impact Assessments (EIA) would suggest a common approach, this however is not the case and carried out ‘in different ways, in different countries and requires a more unified approach’.

With specific regard to the approach in Germany, the Federal Building Code regulation is important as wind energy plants are regarded as so called ‘privileged projects’.

The local authorities thereby can allocate zones for wind energy utilization, or restrict construction (BWE 2009). Therefore, EIA can facilitate in this important decision process, at the same time regulation appears to give room for development.

In the UK the combination of EIA and local planning may have hindered more rapid wind energy deployment as opposed to Denmark, Germany and Spain.

As in other EU countries the majority of wind farm projects in the UK an Environmental Statement (ES) is required and used as a decision tool, identifying the environmental, social and economic impacts of a development.

Whilst engaging local communities is a vital process in the successful deployment of RE such as wind technology. Contrary to this, however it is recognised that a more streamlined approach may be required to drive delivery of targets through the planning process. This appears to acknowledge the large body of studies on implementing EIA,linked to existing barriers as part of the planning process in the UK wind sector.

Adverse Effects of Wind Technology: Noise, Visual Impact, electromagnetic interference Broadly, some observers cite concerns such as turbine noise and aerodynamic noise, in addition to electromagnet interference and migrating birds. Whilst wind turbine noise studies observe that the siting of wind turbines must take sound levels in consideration. A large body of literature exists confirming such barriers exist to implementation.

Further, visual impact is a concern that has been raised and many studies have been made in this regard for on and off shore wind that can adversely effect deployment.

In the wider context of environmental impact however, it is generally acknowledged that wind energy has a key role to play in not only combating climate change but also reducing CO2 emissions from electricity generation.