Day two of the SALGA energy summit saw a focus on the effects of global mega trends on the production and consumption of power in South Africa. The overriding message is that if we don’t embrace change, the sector will not survive.
Several key speakers such as the new COGTA president, Hon. Dr Zweli Mkhize, took to the SALGA stage to discuss the urgent need for energy stakeholders to embrace change.
More specifically, speakers such as Hilton Trollip representing the University of Cape Town and Jeffrey Logan, chief analyst at the National Renewable Energy Laboratory, US, identified which trends would affect the most change, besides the push to achieve democratisation, digitisation, decarbonisation and decentralisation.
Trends to watch
The introduction of the prosumer and intelligent control. The consumer is investing in own-supply to ensure greater control over household devices (Google Nest, a smart-home ecosystem, or energy efficient light bulbs). This trend will give rise to a phenomenon known as grid-defection and will decrease demand for grid-tied power.
Due to this aniticpated decrease in demand and greater investment in own-supply measures, municipalities and utilities will need to re-strategise their business models, to explore maximising existing infrastructure and generate new revenue streams.
Cost of wind and PV has declined and will continue to do so as more innovation is introduced into the industry. Strong growth in renewables is evident, with countries such as China, having installed 54GW of solar PV power last year.
The use of grid integration studies are becoming increasingly popular, to understand how a variety of renewables can be assimilated into existing grid infrastructure.
Grid management through the use of electric vehicles, heat pumps, distributed energy resources, storage and demand response strategies.
Innovative financing and green bonds, with a core focus on equitable distribution of risk on bankable projects.
Decarbonisation initiatives have seen coal generation down by 40% in the past 10 years, as the use of clean energy resources increases. Many new initiatives at sub-government level are taking on the cause, thereby encouraging implementation.
A continued focus on energy access, through the use of solar PV and effective mini grid services will be a priority in emerging markets.
Hydraulic fracturing is increasing the amount of natural gas and oil production thereby lowering prices of commodities. This in turn increases access and encourages development, offsetting the use of coal.
Stakeholders at the SALGA energy summit acknowledged the effects of these trends and the need for urgent change.
However, pleas were made for a regulatory framework that supports such change and encourages public sector integration and private sector participation.
Furthermore, strong calls for cost-reflective tariffs, effective leadership, skills development, revenue management and instilling a culture of payment within municipalities were evident.
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