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City of Cape Town studying battery storage as part of strategy to end load-shedding
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11th March 2022
By: Terence Creamer
Creamer Media Editor
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The City of Cape Town is at the preliminary stages of assessing the business case for the deployment of battery energy storage systems (BESS) as part of its evolving strategy to eliminate the threat of load-shedding for its residents.
The city is already moving ahead with plans to procure 300 MW of renewables generation from independent power producers and generation development manager Shane Prins reports that BESS is also on the city’s radar.
Speaking during a RES4Africa event on the role of BESS in South Africa’s electricity market, Prins said the combination of falling technology costs and the prospect of pairing battery storage with renewables to improve security of supply made the solution potentially attractive.
In addition, the economics of installations were likely to be further enhanced through “stacking”, which involves using single BESS systems to provide multiple electrical services.
Various use cases were being assessed, including grid balancing, energy arbitrage, back-up power, ancillary services and deploying BESS in such a way as to allow for a deferral of distribution and transmission network investments.
“The City of Cape Town is still investigating the optimal manner and phasing of launching utility scale BESS,” Prins stressed, while providing no firm timeframe for when such an investigation might be finalised.
He indicated that there were several supportive factors driving a possible future deployment across the city’s network, including ongoing steep Eskom tariff increases and the utility’s declining technical performance.
In addition, the cost of BESS was falling internationally as research, development and commercialisation intensified.
Municipalities were also now empowered to procure their own electricity and BESS had received an allocation, albeit modest, in the Integrated Resource Plan of 2019 (IRP 2019) – regulatory factors that had hitherto constrained deployments at a local government level.
Nevertheless, a study being compiled by PwC South Africa points to ongoing policy and regulatory uncertainties that are hindering investment across the market, including municipal markets.
Speaking on the same platform, PwC South Africa energy strategy manager Roelof van Huyssteen said the regulatory frameworks were still vague on which use cases would be allowed and how BESS should be procured.
He said the multi-market design outlined in the Electricity Regulation Amendment Bill, which is currently out for comment, appeared supportive of higher levels of BESS investment in future, but use-case, procurement and remuneration uncertainties persisted.
The small IRP 2019 allocation and the fact that BESS investments could proceed only after the publication, by the Minister, of a Section 34 determination under the Electricity Regulation Act remained major impediments.
Van Huyssteen said these should be neutralised through a higher allocation and an amendment to the legislation with regard to Section 34.
Edited by: Creamer Media Reporter
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