date: 16 january 2017 - south african national energy
TRANSCRIPT
ACADEMY OF SCIENCE OF SOUTH AFRICA (ASSAf)
THE STATE OF ENERGY EFFICIENCY TECHNOLOGIES IN SOUTH AFRICA
FINAL REPORT
Date: 16 January 2017
___________________________________________________________________________
i
Table of Contents
List of Tables .............................................................................................................................. i
List of Figures ............................................................................................................................ ii
Abbreviations and Acronym .................................................................................................... iii
1. Introduction ........................................................................................................................ 1
2. Purpose of Report .............................................................................................................. 3
3. Approach and Methodology .............................................................................................. 4
4. Electricity Supply Industry Perspective ............................................................................. 5
4.1 Background ................................................................................................................. 5
4.2 Regulatory regime ....................................................................................................... 5
4.3 ESI reform ................................................................................................................... 6
5. Review and Assessment of historic and current energy saving technologies .................... 7
5.1 Historic energy saving technologies ........................................................................... 7
5.1.1 Ripple control....................................................................................................... 7
5.2 Current energy saving technologies ............................................................................ 8
5.2.1 Efficiency initiatives ............................................................................................ 8
5.2.2 Street lights .......................................................................................................... 9
5.2.3 Tribology............................................................................................................ 12
6. Smart Grid: South Africa ................................................................................................. 12
6.1 Smart Grid technology deployment in efficiency improvement ............................... 12
6.2 Smart Grid related research and technology development opportunities ................. 24
6.3 Landscape of institutions engaged in smart grid research ......................................... 25
7. Conclusion ....................................................................................................................... 27
8. Contact Information ......................................................................................................... 29
ANNEXURE A: Documents Reviewed .................................................................................. 30
ANNEXURE B: Individuals Interviewed ................................................................................ 32
List of Tables
Table 1: Streetlight efficiency improvement ........................................................................... 10
Table 2: Pilot sites .................................................................................................................... 19
Table 3: Eskom Smart grid related research ............................................................................ 20
Table 4: University Smart grid related research ...................................................................... 21
Table 5: Technology Applications ........................................................................................... 23
___________________________________________________________________________
ii
List of Figures
Figure 1: ESI value chain ........................................................................................................... 1
ASSAf Date 16 January 2017
___________________________________________________________________________
iii
Abbreviations and Acronym
AAM Advanced Asset Management
ADAM Approach to Distribution Asset Management
AMI
AMR
Advanced metering infrastructure
Advanced meter reading
ANM Active Network Management
ASSAf Academy of Science of South Africa
CFL Compact Fluorescent Lamp
DA Distribution Automation
DG Distributed Generation
DoE Department of Energy
DR Demand Response
DST Department of Science and Technology
EPRI Electricity Power Research Institute
EEDSM
EDI
ESI
Energy Efficiency and Demand Side Management
Electricity Distribution Industry
Electricity Supply Industry
ERP Enterprise Resource Planning
ETPSG European Technology Platform Smart Grid
EU European Union
IDM Integrated Demand Management
IEP Integrated Energy Planning
IPP Independent Power Producer
ISGAN International Smart Grid Action Network
NEES National Energy Efficiency Strategy
NER National Electricity Regulator
NERSA
NMD
National Energy Regulator of South Africa
Notified Maximum Demand
___________________________________________________________________________
iv
NMS Network Management System
NREL National Renewable Energy Laboratory
OMS
OT
Outage management system
Operational Technology
RES Renewable Energy Sources
RDI Research, Development and Innovation
SANEDI South African National Energy Development Institute
SAPP Southern Africa Power Pool
SGMM Smart Grid Maturity Model
___________________________________________________________________________
v
Disclaimer:
This document has been prepared for use by the Department of Science and Technology
(DST) and the Academy of Science of South Africa (ASSAf) and focus on the state of energy
efficiency technology in South Africa with reference to smart grids.
The author, nor any person acting on his behalf, (a) makes any warranty, expressed or
implied, with respect to the use of any information disclosed in this document or (b) assumes
any liability with respect to the use of any information disclosed in this document. Reference
herein to any specific commercial product, process, or service by its trade name, trademark,
manufacturer, or otherwise, does not necessarily constitute or imply its endorsement,
recommendation, or favouring by the independent researcher.
Any recipient of this document, by their acceptance or use of the information contained in
this document, releases the author from any liability for direct, consequential or special loss
or damage whether arising in contract, warranty, express or implied, and irrespective of
fault, negligence, and strict liability.
ASSAf 16 January 2017
___________________________________________________________________________
1
1. Introduction
Energy efficiency as a way of proactively managing energy consumption as well as the
effective use of the available energy resources, is not a concept which is well entrenched in
South Africa. For many decades South Africa enjoyed the benefit of very competitively priced
electricity to end customers while the electricity network was relatively stable. Therefor it
could be argued that electricity as an energy source had an “unfair” advantage over other energy
options. It is however also important to note that a very large percentage of the population did
not enjoy access to electricity. It was only during ~1992 that the drive to improve access to
electricity really gained momentum. Energy is generally accepted as a key driver in respect of
economic growth and wealth creation in any country. This implies that the access to energy,
the availability and reliability of the energy source and the efficient use of energy becomes
critical. In the context of this report the focus is primarily on the electricity supply industry
(ESI) and the electricity distribution industry (EDI). In the South African context Eskom is the
dominant generator of electricity while they also own and operate the transmission grid. Eskom
is responsible for the generation of ~96% of electricity generated in South Africa. From a
distribution of electricity to end customers’ perspective, the municipalities and Eskom
(Distribution) are the primary service providers. Municipalities distribute electricity to ~60%
of the end customers while the balance of customers is supplied by Eskom. Eskom also supplies
electricity to the majority of the very large mining and industrial customers in South Africa.
The figure below reflects the ESI value chain as applicable to South Africa:
Figure 1: ESI value chain
South Africa currently finds itself in a situation where there are generation shortages and the
country is therefore faced with a significant generation expansion programme. In addition to
the “Eskom build programme” the government also embarked on the introduction of a
renewable energy programme and the introduction of Independent Power Producers (IPP). The
creation of the new generation capacity as well as the environmental compliance requirements
ASSAf 16 January 2017
___________________________________________________________________________
2
are among the factors which will contribute to higher electricity prices. Therefore, the need to
introduce energy efficiency strategies, as well as effective energy and demand management,
are now greater than ever before. It is also essential that utilities will have to get “smarter” in
their business operation, asset management and customer management.
Technology deployment e.g. the introduction of smart grids, is globally regarded as a key
enabler to unlock efficiency, to facilitate growth and to enhance customer communication and
interface. The secret is however to identify the technology applications which will best serve
the requirements of a specific utility and their customers.
ASSAf 16 January 2017
___________________________________________________________________________
3
2. Purpose of Report
This report reflects the status of energy efficiency technology research, development and
innovation (RDI) in South Africa based on a study undertaken by the Academy of Science of
South Africa (ASSAf). Furthermore, the report is aimed at informing the Department of
Science and Technology (DST) of opportunities which could be explored for further
development of human capital, intellectual property output, technology development and
innovation in the context of smart grids.
ASSAf 16 January 2017
___________________________________________________________________________
4
3. Approach and Methodology
The objective was to collect relevant information from an electricity supply industry (ESI)
perspective which will assist in defining the state of energy efficiency in the context of smart
grids. In general, limited documented information is available on technology deployment in
South Africa since reporting on energy efficiency technology deployment is not a regulated or
reporting requirement. The South African National Energy Development Institute (SANEDI),
the utilities who participated in smart grid related projects under the guidance of SANEDI and
Eskom were found to have the best documented information pertaining to smart grids and
related technology deployment. Due to the time limitation associated with the assignment the
traditional approach in respect of site visits and one on one personal interviews could not be
pursued. An approach was adopted which included documentation collection and telephonic
interviews which was complemented by the personal industry knowledge and experience of
the independent researcher.
The methodology followed included the evaluation of available related reports, supporting
documentation and the research of appropriate practices and energy efficiency technology
deployment opportunities pursued by utilities. The research methodology and supporting data
collection was structured to provide a perspective in respect of:
Smart grids
Solid state lighting
Tribology
While all the documents referenced in Annexure A was not used in the compilation of the
report they were consulted by the author to among others verify some
views/learning/experiences.
ASSAf 16 January 2017
___________________________________________________________________________
5
4. Electricity Supply Industry Perspective
4.1 Background
Considering the background to the electricity supply industry in South Africa it is important to
note that it is an industry that evolved over decades without driving towards a defined future
structure. Therefor it should be no surprise that the South African electricity distribution
industry is highly fragmented. The electricity service is predominantly being provided to
customers by ~175 licensed municipal electricity businesses and Eskom, the state owned
vertical integrated utility. The current model is inefficient and is not optimally serving the best
interest of the country, the economy and customers at large. Furthermore, the industry is faced
with significant financial and human resource skills shortages in addition to; among others
price inequality, inconsistent service to customers and a significant maintenance, refurbishment
and infrastructure strengthening backlog.
The Energy White Paper1, approved by Cabinet in December 1998, among others, informed
the ESI reform mandate and process. As articulated in the Energy White Paper, among others
Government supports the gradual steps towards a competitive electricity market while
investigations into the desired form of competition are completed. It furthermore indicated that
Eskom will be restructured into separate generation and transmission companies. Government
supports the development of the Southern African Power Pool (SAPP). The introduction of the
energy regulatory regime as well as the establishment of the Electricity Distribution Industry
Holdings Company, are some of the measures which were introduced by the Government to
improve the industry governance, performance and efficiency2.
4.2 Regulatory regime
The National Electricity Regulator (NER), now the National Energy Regulator of South Africa
(NERSA), was established on 01 April 1995. In essence the objective of the NER was to ensure
order, structure and sound decision making in the electricity supply industry.
While the electricity distributors in South Africa are required to have a license issued by the
National Energy Regulator of South Africa (NERSA), the Constitution presently grants
municipalities’ executive authority over, and the right to administer, electricity reticulation.
This arrangement fundamentally implies that Municipalities in South Africa have
constitutional and other legislative rights to supply electricity within their local boundaries
while Eskom has legislative rights to supply throughout South Africa where municipalities, or
other licensees, are not supplying. This renders a very complex arrangement and as a result, it
is very difficult to regulate and monitor the industry while it is not possible for national
1 Source: 1998 White Paper on the Energy Policy of the Republic of South Africa 2 Source: 1998 White Paper on the Energy Policy of the Republic of South Africa
ASSAf 16 January 2017
___________________________________________________________________________
6
government to put in place effective governance, regulatory and investment frameworks for
the entire electricity supply industry.
Pockets of good performance in the current EDI are recognised. However, the role of NERSA
is somewhat compromised while the viability of the industry is under risk. The industry risks
are among others due to the underinvestment in infrastructure by the current asset owners and
ineffective business practices.
In addition to the establishment of the Regulator, government also introduced the reform of the
Electricity Supply Industry in South Africa, starting with the EDI.
4.3 ESI reform
The need for the restructuring of the ESI in South Africa was identified by government as an
important initiative to ensure economic growth and stability in the electricity sector. The desire
to improve the financial viability and sustainability of electricity sector; to attract investors, to
guarantee equitable treatment of customers in respect of prices and quality of supply and
service; to remove existing inefficiencies resulting from a fragmented distribution sector; to
ensure economies of scale; to recapitalise the currently under-funded electricity distribution
network assets; and to ensure that, among others; the national electrification programme is
undertaken in a co-ordinated manner reflects some of the key drivers.
During 1997 Cabinet approved the Electricity Industry Interim Committee (ERIC) report,
which recommended the restructuring of the Electricity Distribution Industry into a number of
Regional Electricity Distributors (REDs). A further decision was taken by Cabinet in 1999 to
approve the transitional process to move the industry to the RED structure. These decisions by
Cabinet led to the establishment of, the Electricity Distribution Industry Restructuring
Committee (EDIRC) in 1999. The key objective of the EDIRC was to develop proposals and
recommendations to implement the Cabinet resolutions.
During 2003 the Electricity Distribution Industry (EDI) Holdings Company was established as
the first step in the restructuring process. The objective was to use EDI Holdings as the vehicle
to drive the reform process and to establish the REDs. Despite good progress, challenges
pertaining to the formulation of reform enabling legislation and conflict in the powers and
functions of municipalities, substantially impacted on the progress towards establishing the
REDs.
On 08 December 2010, the Cabinet passed a resolution to close EDI Holdings on 31 March
2011 and to discontinue the process of creating the REDs. The media release3 stated that:
“Cabinet decided to terminate the Electricity Distribution Industry (EDI) restructuring and to
discontinue the process of creating the Regional Electricity Distribution (REDS) with
immediate effect. Although the Electricity Distribution Industry Holdings (EDIH) had made
significant progress in establishing the REDs, Cabinet approved the recommendation that the
Department of Energy takes over the programmes previously executed under the EDIH
mandate. The department will review the whole electricity value chain with a view to
3 Source:2010 December 09: GCIS Press Release
ASSAf 16 January 2017
___________________________________________________________________________
7
developing a holistic approach to revitalise electricity infrastructure, energy security as well
as the financial implications. An administrator will be appointed to attend to the winding up of
EDIH. The EDIH Board will remain accountable until the end of the 2010/11 financial year.”
The establishment of a well-functioning Regulator, supported by a structured industry reform
process, would have gone a long way towards a sustainable industry.
5. Review and Assessment of historic and current energy saving
technologies
5.1 Historic energy saving technologies
In relation to this report, the importance of the background provided in the first sections is to
provide context in respect of the environment in which the industry in question is operating in.
It also provides some appreciation for the impact of the absence of integrated reporting on
among others the introduction of energy efficiency initiatives and technology deployment.
Furthermore, it provides insight into the complexity to introduce efficiency improvement
measures in an integrated manner, while it explains why South Africa finds it difficult to yield
optimal energy efficiency results.
It is widely recognised that South Africa has an energy intensive economy which enjoyed the
benefit for many decades from relatively low cost electricity and high network/grid reliability.
The historic energy saving strategies and technologies applied were not driven from an energy
efficient use perspective.
5.1.1 Ripple control
As stated, historically energy efficiency saving strategies in the pure sense of the definition was
not pursued. The initiatives pursued were mainly informed by the need to manage network
loading and maximum demand reduction. Network loading refers to the impact on the
infrastructure used to supply electricity to customers as a result of the real time electricity
consumption of the customers supplied. Exceeding the ability of the infrastructure in question
to supply the load could result in increased technical losses, network overloading and supply
interruptions. Exceeding the maximum notified demand i.e. the contracted capacity to be made
available through the bulk supplier of electricity e.g. Eskom, results in penalties. The initiatives
pursued therefor had an impact on the improvement of the power system efficiency and was
not aimed at energy efficiency improvement from a customer perspective. Considering the risk
to the network and the risk of financial penalties, the ability to manage the load and to interrupt
the customer load through a controlled intervention, would therefore be the preferred option.
To this end the use of Ripple Control was found to be rather effective from a power system
efficiency perspective, while power factor correction was also pursued to a certain degree.
Power Factor correction did contribute to the efficiency improvement of the end use loads. In
most cases the key power factor correction driver was however the potential reduction in the
electricity bill to be paid to the relevant utility. Ripple Control was deployed mainly in the
larger municipalities as well as some of the secondary municipalities. In the main
ASSAf 16 January 2017
___________________________________________________________________________
8
geyser/electrical hot water cylinder related load was targeted. The Ripple Control load
management initiatives mainly impacted on the commercial and domestic sector. The current
status in the industry is that most of the installed Ripple Control related equipment is not
functioning. While the use of Ripple Control in load management might not be the “smartest”
technology available, it remains a relative effective load management tool while also improving
the efficiency of the power system. Ripple Control was not pursued by Eskom and mainly
informed by the customer base served and alternative measures deployed to manage the load
profile and energy consumption. Some of the measures introduced by Eskom to manage
network loading and energy consumption included load shedding, alternative tariff models, and
specific contractual arrangements.
While the historic initiatives described could by “default” have energy efficiency improvement
“flavour,” the key driver was not energy efficiency but rather load or demand management.
5.2 Current energy saving technologies
5.2.1 Efficiency initiatives
The electricity supply landscape changed significantly since 2007. While South Africa did
experience some generation shortages in the mid 80’s, it did not result in the extensive load
shedding challenges experienced during 2007 and 2008. The greater environmental awareness
plus the electricity supply challenges and increase in electricity prices, created the desired
platform to review the approach and focus in respect of the efficient use of the available energy
resources. Against this background the Energy Efficiency and Demand-Side Management
(EEDSM) programme, which target the reduction of electricity consumption in municipalities,
was initiated in 2009 by National Treasury and later handed over to the Department of Energy
(DOE). The interventions were mainly aimed at retrofitting of existing municipal infrastructure
such as public lighting, street- and traffic-lighting and municipal building lighting with energy
efficient technologies. In total 54 municipalities participated in the programme. These
efficiency initiatives were demand side related and while it should have a positive impact on
the electricity system, it will be difficult to assess the real efficiency improvement derived from
the EEDSM initiative since municipalities do not follow a practice of effective business ring-
fencing and neither was the base line defined at programme introduction.
Furthermore, industry wide initiatives were embarked on to promote the efficient use of energy
through strategies aimed at:
Geyser/hot water-cylinder insulation improvement
Replacement of incandescent lamps with compact fluorescent lamps (CFL)
Solar hot water geyser rollout
In respect of geyser/hot water-cylinder insulation improvement and CFL introduction, Eskom
played a leading role while numerous municipalities also participated in the programme. While
the CFL initiative was well received by the industry and customers, the sustainability of the
initiative can be questioned. There is a substantial cost difference between the CFL and the
normal incandescent lamp. This implies that there is a risk that a customer might default to the
ASSAf 16 January 2017
___________________________________________________________________________
9
less efficient option should the CFL fail. The solar hot water geyser rollout was primarily a
DOE initiative implemented with support from municipalities and Eskom. This initiative was
also well received, however the absence of an effective maintenance strategy renders a large
percentage of the installed geysers not functional4.
The Building Regulations & Building Code (SANS 10400-XA:2011 and SANS 204)
require in the built environment construction standards pertain to energy use and energy
efficiency in buildings. This requirement is applicable to all plans submitted for municipal
approval. Furthermore, SANS 941: Energy efficiency of electrical and electronic apparatus
covers the measurements and energy efficiency labelling of electrical and electronic
apparatus.
From a legislative perspective National Treasury proposed Carbon Taxes to incentivise energy
efficiency5. National Treasury and DOE have also gazetted Energy Efficiency Tax Incentive
Regulations aimed at incentivising investment in energy efficiency initiatives.
To address efficiency improvement effectively requires political, policy, regulatory, incentive,
stakeholder and electricity supply industry alignment.
5.2.2 Street lights
Over the last couple of years’ numerous municipalities pursued energy efficiency
improvements related to street lighting. The energy efficiency initiatives pursued, in the main
related to areas where funding incentives were provided. For the purpose of this report “street
lighting” refers to the lighting provided on major and minor roads or streets, as defined in
SANS 10089. High masts street lights are excluded since numerous local authorities have
adopted a decision to do away with this category of street lights.
The estimated 1,8 million street lights in South Africa provides an important service. The
annual cost is estimated at R 400 million with an energy consumption estimated at 1 GWh of
electricity and responsible for about 1 million tons of CO2 emissions. The annual energy
consumption is comparable with that of 150,000 South African homes. Street lighting accounts
for ~ 2 % of the typical municipal electricity consumption and as such it would contribute
between 0.8 and 1.2 % to the national electricity load. However, if the municipality’s internal
consumption is considered, it represents up to 20% of the overall internal consumption of a
municipality.
The street lights utilised in South Africa by local authorities range from very inefficient fittings,
some installed in the 1960’s, up to reasonably efficient modern fittings and even in some cases,
state of the art energy efficient street lights. Most of the municipalities and Metros in South
Africa are already utilizing efficient light sources, such as High Pressure Sodium (HPS).
There are basically three distinct options available to improve energy efficiency in respect of
street lights. These ranges from (1) retrofit of lamps and luminaire mountings (2) implement
4 Note from interview with Mr M Bukula 5 Carbon Taxes-2013/2014
ASSAf 16 January 2017
___________________________________________________________________________
10
power and/or ballast switching and (3) install state of the art technology street lights in order
to do technology quantum leaping.
Table 1: Streetlight efficiency improvement
Options Examples Comments Efficiency
improvements
Retrofit Replacing
Mercury Vapor
(MV) luminaries
with High
Pressure Sodium
(HPS) luminaries
An economically
favorable option is to
replace higher
wattage MV
luminaries (at the end
of their useful life)
with HPS luminaries.
Various local
authorities have
initiated such projects
under the DoE
Energy Efficiency
(EE) lighting
strategy.
A change of lamp to
a different type
requires the change
of the electrical
control gear,
typically consisting
of electrical ballast,
igniter, condenser, as
well as the light
luminaires.
Retrofit could
contribute to
sustainable
energy
efficiency
improvements
Reflector
replacements
By using the
correctly designed
reflector, the energy
consumption can be
reduced dramatically
without reducing the
lighting levels
Replacing MV
and HPS with
57W CFL
luminaries
Replacing luminaries
with 57 CFL
luminaries.
Technically the 57W
CFL luminary is not
as reliable as the
conventional lamps.
Replacing the
luminaire with
a more energy
efficient
alternative will
improve the
efficient use of
energy
ASSAf 16 January 2017
___________________________________________________________________________
11
Options Examples Comments Efficiency
improvements
Power and/or
ballast switching Voltage reduction
systems
A voltage regulator
reduces the lamp
current and therefore
the luminous flux by
means of input
voltage reduction.
Only appropriate for
HPS and Mercury
Vapour lamps.
Applicable for
original over
designed street light
network systems.
Effective
voltage
management
could directly
contribute the
system
efficiency
improvements
Power switching
Power switch enables
the reduction of
luminous flux and
energy consumption
during hours of lower
use.
Ballast switching Replace conventional
with electronic
ballasts.
State of the art
technology Tele-management
Communication
system that controls
individual luminaire
by means of RF or
GSM technologies.
“Smart” electronic
ballasts are required
for this
communication with
the lamp.
ASSAf 16 January 2017
___________________________________________________________________________
12
Options Examples Comments Efficiency
improvements LED lamps
Used more and more
in the role as street
lights, but is currently
much more expensive
than conventional
street lamps.
Can be used in
conjunction with
renewable energy
supply options.
In general
LED’s provide
the potential
for lower
energy
consumption
for the same
light output
derived from a
more energy
intensive
option which
directly results
in improved
efficiency
Induction lamps Emerging lamp
technology that has
not been used in
South Africa, but is a
growing technology
in the rest of the
world.
To be able to measure the efficiency improvement derived from the introduction of the
initiatives described above will require the establishment of the “as-is” baseline, registering of
initiatives and monitoring of the rollout of the relevant initiatives.
5.2.3 Tribology
From an energy efficiency improvement perspective, the research did not present many
comprehensive examples of tribology related initiatives within the electricity supply industry
in South Africa.
6. Smart Grid: South Africa
6.1 Smart Grid technology deployment in efficiency improvement
The efficiency initiative information provided in section 5 above indicates that the approach
adopted to date in South Africa did not take the integrated electricity supply system into
account. Furthermore, the initiatives did not form part of a national energy efficiency
improvement plan. The focus was mainly on demand side improvements. While the initiatives
pursued should contribute to a change in the load profile and “flattening” of the system demand,
it will not necessary result in improved network management, reduction of losses, improved
ASSAf 16 January 2017
___________________________________________________________________________
13
business sustainability, energy portfolio optimisation, etc. It is important to note that improved
matching of supply and demand may make the power generation system more efficient and
result in overall energy efficiency improvements in terms of primary fuel consumption even if
end use energy consumption is largely unchanged. To be able to achieve the required balance
from an energy efficient use perspective requires an integrated plan underpinned by
grid/network/plant and customer related intelligence and real time system management
capabilities. Reference to “the system” includes the national electricity system as well as the
system under the control of the relevant utilities e.g. municipalities. Without an integrated
energy efficiency implementation plan, it is doubtful whether the 12% energy efficiency
improvement target reflected in the Energy Efficiency Strategy of South Africa (2005) was
achieved by 2015.
Globally smart grid deployment is pursued with great success to achieve among others the
above stated objectives. The objective to move towards a more intelligent and visible grid is
fundamentally driven by the need to be more energy efficient. Due to the importance of energy
efficiency and the role it plays in economic growth, attractive incentives were provided to move
towards a smarter grid in America, Europe and the UK.
While there are many ways in which a smart grid can be defined, the definition adopted by the
South African Smart Grid Initiative (SASGI), as derived from the European Technology
Platform Smart Grid (ETPSG), defines the smart grid as follows: - “A Smart Grid is an
electricity network that can intelligently integrate the actions of all users connected to it –
generators, consumers and those that do both – in order to efficiently deliver sustainable,
economic and secure electricity supplies.”
Based on ETPSG definition, Smart Grid employs innovative products and services together
with intelligent monitoring, control, communication, and self-healing technologies to:
Better facilitate and manage the connection and operation of all sources of energy.
Give consumers more choice so they can help to optimise energy use.
Provide consumers with greater information and choice of supply.
Significantly reduce the environmental impact of the whole electricity supply system.
Deliver enhanced levels of reliability and security of supply.
In considering the objectives reflected above it is clear that the smart grid will directly
contribute to energy efficiency improvement. A smart grid provides the capability to manage
the industry value chain in an integrated manner while visibility is enhanced which facilitates
proactive decision making and optimisation. The ability to introduce effective load
management, demand response, real time pricing, etc. is dependent on effective customer
interface, grid visibility and plant/network control. It is important to note that “integrated”
energy efficiency from a system perspective is impacted by among others:
The efficiency of power generation, as it links to load profile, variability and matching
of supply and demand e.g. using energy in periods of lower generation cost and resource
availability i.e. when renewable energy is abundant.
ASSAf 16 January 2017
___________________________________________________________________________
14
The efficiency of the transmission and distribution grid i.e. load and no-load technical
loss reduction, reduction in line losses, transformer core losses, etc.
The efficiency in the end use consumption of energy which is influenced by tariffs, load
control etc. Billing and revenue recovery is also core to this as users that don’t pay for
energy use are unlikely to use energy efficiently.
Managing energy efficiency effectively therefore implies a focus on the entire value chain, i.e.
generation, transmission, distribution and the end customer – it cannot be an end
customer/demand focus only. It is acknowledged that the generation of electricity and heat
contributes to greenhouse gas emissions. It must also be appreciated that the electricity demand,
the use of electricity and the managing of the network/grid directly contributes to the generation
requirements. In the constant balance of production and consumption the efficient use of energy
and the ability to leverage alternative energy options, inclusive of storage capabilities become
mission critical. The various applications offered as an integral part of the smart grid solution
provides the key to improved energy utilisation and to address the challenges reflected above.
The extent to which Smart Grids are deployed in South Africa must not be underestimated. The
reality is that from a transmission and the upper end of the distribution voltages, significant
smart grid functionality is present. However, if we consider the distribution infrastructure in its
broader context and in particular at the lower voltages, very little and in some cases no
advanced technology deployment is present. It is for this very reason that the distribution
industry is confronted among others with extended outages, high losses (technical and
billing/theft related), inefficient energy utilisation, limited data which could be used to enhance
decision making and virtually no customer participation/communication. It is however
important to keep in mind that most of the current distribution infrastructure was designed and
built with a 20th century reference. It is therefore important to enhance the grid intelligence to
be able to facilitate aspects such as demand response, energy conservation, the introduction of
renewable energy options, outage management, grid self-healing, etc. The smart grid related
initiatives currently pursued in South Africa are mainly driven by the need to improved
renewable energy integration, decarbonizing the electricity generation, improve the ability to
effectively manage the grid, improve the network reliability and availability, reduce operating
costs and to respond to national imperatives. Energy efficiency is not the primary driver. The
transition towards smarter grids are however slow since funding support is limited. Despite the
pockets of progress, technology deployment e.g. smart grids are not leveraged to its full
potential. Once the electrical systems are “enabled from a smart grid perspective” it will be
substantially easier to accommodate the flexibility required in the management of renewables.
Therefore, smart grids can directly contribute to the reduction in CO2 emissions, eliminating
one of the main causes for climate change.
The initiatives pursued by the utilities in South Africa can broadly be categorised into the
following areas:
ASSAf 16 January 2017
___________________________________________________________________________
15
Initiative Focus Impact on Energy
Efficiency
Distributed power
generation
Facilitate integration of
alternative energy options
harvesting clean energy
sources and move from
“unidirectional” to “bi-
directional” energy flow
Directly contributes to the
optimisation of the potential
energy portfolio
Improved revenue
management
Improved revenue
realisation
Indirectly influence energy
consumption and efficient
use of energy
Energy efficiency and
demand side management
Loss reduction,
network/plant loading and
demand reduction
Direct focus on efficient use
of energy
Outage Management Reduce network down time Indirect focus on efficient
use of energy
Improved grid/network
visibility
Improved ability to monitor
plant/equipment, to
effectively deploy resources
and real time optimisation of
network switches and
voltage control thereby
reducing line losses and
energy consumption
Indirect contribution to
energy efficiency
Active network
Management
Improved ability to manage
grid/network real time and
to optimise network loading
Direct contribution to
energy efficiency e.g.
flattening of the load profile
will reduce technical losses
and the maximum demand
Advanced asset management Reduce asset down time,
optimise operating costs and
extend asset life
Indirect contribution to
energy efficiency
While the “smartness” of a specific network must be defined by the asset owner; the
development of a smart grid, inclusive of the required back-office support, is a “technology
journey” and not a single event. While smart metering is pursued by most of the utilities in
South Africa, from a smart grid deployment perspective, the following South African entities
are making the best progress towards a smarter grid:
City of Cape Town
City Power
Eskom
Ethekwini Metropolitan
Nelson Mandela Bay Municipality
Considering the energy challenge which South Africa is faced with, there is an urgent need to
enhance the efficient use of the available energy portfolio. The inability of utilities to
effectively introduce energy efficiency and demand side management in the context of
ASSAf 16 January 2017
___________________________________________________________________________
16
integrated demand management (IDM) stems from the absence of effective grid/network
visibility, active network management capabilities and/or remote switching capability. This
implies that the larger percentage of utilities in South Africa do not have the technology
capability to manage their load profile and demand in real time. To facilitate effective energy
management smart grid capabilities are of critical importance. Furthermore, outdated plant and
equipment in some cases compromise the ability of utilities to deploy near-real time network
management practices. Numerous municipalities are confronted with exceeding their notified
maximum demand (NMD) which results in network demand exceedance penalties. The more
important challenge is however the negative impact on the national grid inclusive of the
inefficient energy utilisation and generation requirements. This is an area where applications
within the suit of smart grid functionalities could be deployed to improve energy efficiency.
This is an example of an initiative which could present substantial local and national efficiency
improvement benefits.
Smart grid technologies fundamentally introduce a layer of digital intelligence to the grids and
marry the interface between the classical grid infrastructure and the information technology
capabilities. In this way the industry is enabled to respond to grid dynamics, restore power
interruptions, accommodate alternative energy options, facilitate demand response strategies,
etc. The importance of the interdependency between policy, standards and technology must be
appreciated. Without an overall integrated approach and enabling policies the roll out of Smart
Grids could result in less than optimal results.
The European Commission stated on 04 December 2011 in Brussels: “The European Union
2020 agenda comes across with a clear message for Europe. The EU’s future economic growth
and jobs will increasingly have to come from innovation in products and services for Europe’s
citizens and businesses. Innovation will also contribute to tackling one of the most critical
challenges Europe is facing today, namely ensuring the efficient and sustainable use of natural
resources. The development of our future energy infrastructure must reflect this thinking.
Without serious upgrading of existing grids and metering, renewable energy generation will
be put on hold, security of the networks will be compromised, opportunities for energy saving
and energy efficiency will be missed, and the internal energy market will develop at a much
slower pace.” The report further states: “Smart Grids provide a platform for traditional energy
companies or new market entrants such as ICT companies, including SMEs, to develop new,
innovative energy services while taking due account of data protection and cyber-security
challenges. That dynamic should enhance competition in the retail market, incentivise
reductions in greenhouse gas emissions and provide an opportunity for economic growth.”
In an article published on 22 April 2013 in energies, the author, Rosario Miceli, reflects on the
benefits derived from the introduction of a smart grid and states: “Targeting environmental
sustainability, energy efficiency and new power distribution, business models have to be
evaluated. Moreover, innovative, energy-aware, flexible and user-centric solutions, able to
provide interactive energy monitoring, intelligent control and power demand balancing at the
home, block and neighbor level are needed. These solutions will interconnect legacy
professional/consumer electronic devices with a new generation of energy-aware white-goods
ASSAf 16 January 2017
___________________________________________________________________________
17
in a common network, where multi-level hierarchic metering, control and scheduling will be
applied, based on power demand, network conditions and personal preferences. Moreover,
renewable energy systems that will optimize and integrate, for example, an innovative
combined photovoltaic/solar (CPS) system can be used. These systems will provide hot water
for white goods (such as a dishwasher and washing machine) in order to strongly decrease the
energy consumption and the CO2 emissions at home by reducing/removing the heating
operational cycles; electrical energy from renewable energy sources (RES), which can be
utilized at home and during peak periods, even fed to the electricity network in a reverse power
generation/distribution business model. Information from CPS system will be shared in the
management network and used for a new set of energy management rules in order to maximize
energy savings and environmental savings at the home, block and neighbor level. In addition
to the energy management methodology to be used at the load level, they are now emerging in
smart grids in the vision of power system innovation”. The article further states: “Reliability,
efficiency and safety improvements of power distribution networks are accomplished through
communication and computing technologies. Smart grids can enhance the energy efficiency of
the grid to the benefit of the end-users by both coordinating and scheduling low priority home
devices, so that their power consumption takes advantage of the most appropriate energy prices
and/or energy sources at a given time. Furthermore, real-time information transmitted over
communication networks will allow power outage anticipation, as well as service perturbation
detection. By rapidly detecting and analyzing data coming from the distribution network, the
smart grid will be in a position to take corrective actions, so as to restore power stability when
needed. Harmonizing local distribution at the house level with energy distribution at a larger
level can also reduce grid congestion. Last, but not least, an enhanced electrical grid is expected
to lower CO2 emissions by reducing end-user energy consumption during peak hours, when
electricity is generated through power plants that produce a lot of CO2 emissions.”
A May 2011 report by the Asia-Pacific Economic Cooperation (APEC), titled “Using Smart
Grids to Enhance Use of Energy-Efficiency and Renewable-Energy Technologies,” states the
benefits to be derived through smart grid deployment in respect of energy efficiency is
recognised. The report however also states: “The engagement of end-use systems in demand
response through real-time pricing signals or other incentives is low, with wealthier and more
urban member economies showing the most activity in this direction. Of all smart grid
technology deployments, advanced metering infrastructure is receiving the most attention.
While this is a logical first step in a roadmap of smart grid deployments that will enable other
capabilities, it is only a start and addresses a small fraction of the potential benefits from
implementing smart grid capabilities. Even after measurement and communications systems,
such as AMI, are installed, significantly more work will be needed to advance energy efficiency
and support the integration of significant amounts of renewable resources.”
The International Telecommunication Union (ITU), produced in 2012 a report titled: “Boosting
energy efficiency through Smart Grids.” The report recognised the potential to improve
efficiencies, manage the expected industry change and addressing climate change through the
deployment of smart grids. However, it also emphasised the importance of following a systems
approach taking into account the entire value chain from generation to the end-customer.
ASSAf 16 January 2017
___________________________________________________________________________
18
Furthermore, the report states: “In order to maintain the grid stability in the presence of great
amounts of variable production from renewable sources, a large effort is required to control
other generators and/or the energy demand (loads) by actively involving the users to modify
their consumption according to the current production. The actual electrical grid control
method, with production that follows the “user demand”, is expected to change towards a more
flexible scheme, in which the “user demand” can be influenced or partially controlled
depending on renewable production availability. This evolution will change the whole
electricity supply chain, from generation, transmission and distribution to the customer side.
The current system will progressively see an increasing number of “prosumers”, namely, users
that are both producers and consumers. The variable and unpredictable power production from
renewable energy sources in different hours and seasons will require flexible dynamic loads
and large storage capacity to keep an optimal balance between availability and demand of
electric energy. Advanced types of control and management technologies for the electrical grid
can also contribute to a more efficient operational running of the overall system. These
technologies include devices such as smart electricity meters that show real-time use of energy
and that can respond to remote communication, enabling dynamic electricity pricing related to
real production and distribution costs.”
Furthermore, the report states: “Distribution is the most affected domain by the Smart Grid
implementation. Indeed, the distribution grid has to integrate dispersed small/medium size
generators and manage bidirectional power flows on a grid designed for unidirectional flows.
The distribution grid is where end users are connected and where Advanced Metering and new
policies of demand management can be implemented. Widespread adoption of PEVs (Plug-in
Electric Vehicles) and PHEVs (Plug-in Hybrid Electric Vehicles) will bring additional and
critical load to the grid.
The availability of distributed generators gives a real chance to have local production where
electric power is needed. This approach can reduce the bulk of energy transferred by long
transmission lines and bring more efficiency, due to less power losses. This can also increase
the local reliability of the power systems and provide better efficiency by using local renewable
resources (wind, water, sun, biomasses).
The integration on the distribution grid of a great number of partially predictable variable
sources and of new types of loads poses grid operation issues that require new control and
protection schemes. One of the possibilities to balance generation and load in real time is to
involve consumers, by asking them to modify their normal consumption patterns in response
to a utility's need.”
In general, the reports referenced indicate that among others energy efficiency improvements
in the electricity value chain can be achieved through smart grid deployment. It is however
important to note that effective smart grid rollout starts with effective planning followed by
selecting applications within the suit of smart grid options which will best serve the
requirements of a specific utility. Therefore, it is important to evaluate the available options
and subject the options selected to a pilot site, before embarking on a mass rollout. South Africa
ASSAf 16 January 2017
___________________________________________________________________________
19
substantially lags the international smart grid leaders in respect of deploying smart grid
applications to improve efficiency.
From a local perspective, entities/institutions conducting a level of research in respect of smart
grid applications were considered. Cases were not considered where smart grid applications
were procured and implemented without a level of classical research.
In the case of South Africa, the available research reports are limited largely to SANEDI,
Eskom, the National Cleaner Production Centre of South Africa and GreenCape. Through the
SANEDI applied research programme, pilot sites were established in 9 municipal areas to pilot
smart grid related applications to improve efficiency in the electricity value chain6. The pilot
site selection was not driven from an energy efficiency perspective at the core but rather from
a business sustainability and service delivery improvement perspective. The pilot sites and the
applications applicable are reflected in the table below:
Table 2: Pilot sites
Site Research Objectives Smart Grid Application
eThekwini To assess the readiness and
technology deployment status
of the business
To enhance asset management
through a smart grid
Smart Grid maturity
assessment
Advanced Asset
Management
City Power To assess the readiness and
technology deployment status
of the utility
To evaluate the system
requirements when multiple
tariff options, inclusive of IBT,
are made available to customers
Smart Meter deployment
Load Limiting through
smart meters
Tariff switching through
smart meters
Govan Mbeki To assess the readiness and
technology deployment status
of the business
Revenue enhancement
Smart Grid maturity
assessment
Smart Meter deployment
Nala To assess the readiness and
technology deployment status
of the business
Revenue enhancement
Smart Grid maturity
assessment
Smart Meter deployment
Naledi To assess the readiness and
technology deployment status
of the business
Revenue enhancement
Smart Grid maturity
assessment
Smart Meter deployment
Nelson Mandela Bay
Municipality To assess the readiness and
technology deployment status
of the business
Smart Grid maturity
assessment
Asset management
6 Note from interview with Mr T Yusuf, SANEDI
ASSAf 16 January 2017
___________________________________________________________________________
20
Site Research Objectives Smart Grid Application
Smart grid enabled asset
management
Mogale City To assess the readiness and
technology deployment status
of the business
Smart Grid maturity
assessment
Smart Meter deployment
Msunduzi To assess the readiness and
technology deployment status
of the business
Smart Grid maturity
assessment
Asset Management
Thabazimbi To assess the readiness and
technology deployment status
of the business
Smart Grid maturity
assessment
Smart Meter deployment
SANEDI is also involved in conjunction with DOE in a project aimed at energy efficiency
improvement in targeted government buildings through smart grid applications. While the
required base line evaluations were conducted, the metering requirements addressed and the
project governance established, reports were not available to be considered for inclusion in this
report.
Eskom conducted smart grid related research among others in the following areas, to improve
efficiency in the electricity value chain7:
Table 3: Eskom Smart grid related research
Research Objectives Smart Grid Application Potential Impact on
Energy Efficiency
Improve generation
black start capability Plant and grid dynamic
management
No direct impact on
efficient use of energy
Improved grid &
equipment visibility Supervisory control and data
acquisition (SCADA)
Indirect impact on
efficient use of energy
Improved remote plant
& equipment condition
monitoring
Advanced asset management Indirect impact on
efficient use of energy
Improve customer
interface and enhance
revenue management
Smart metering
Metering Data Management
System (MDMS)
Direct impact on efficient
use of energy
Enhance system loading
under controlled
conditions
Grid sensors Direct impact on energy
efficiency
Improve communication
reliability and capacity
Architecture development No direct impact on
efficient use of energy
Improved Overhead Line
visibility and enhance
flexibility in respect of
managing line thermal
rating
Line Sensors Direct impact on efficient
use of energy
7 Note from interview with Mr N Singh, Eskom
ASSAf 16 January 2017
___________________________________________________________________________
21
Research Objectives Smart Grid Application Potential Impact on
Energy Efficiency
Improve efficiency of
workforce deployment
Active workforce deployment No direct impact on
efficient use of energy
Improved customer
participation in energy
efficiency
Home energy system/control Direct impact on efficient
use of energy
Understanding the
system dynamics when
disruptive technologies
are introduced (PV
Rooftop, etc.)
Advanced asset management Direct impact on efficient
use of energy
Enhance ability to
electrify deep rural areas Micro grids Direct impact on efficient
use of energy
Improve energy
management in the
distribution component
of the ESI
Integrated demand side
management
Energy trading
Direct impact on efficient
use of energy
Optimise use of smart
grid related investment
through leveraging
interoperability
Advanced infrastructure
management Indirect impact on
efficient use of energy
The South African Industrial Energy Efficiency Project, hosted by the National Cleaner
Production Centre of South Africa, assisted industry in South Africa to reduce their energy
consumption and their greenhouse gas emissions. This initiative resulted in an avoided energy
cost estimated at R1,76 billion over the past 5 years8.
The following universities established specific competencies which could be leveraged from
an energy efficiency and smart grid perspective9:
Table 4: University Smart grid related research
University Competency that could be leveraged
University of Cape Town Modelling & Simulation
Durban University of Technology Real time simulator
University of KwaZulu-Natal Real time simulator
HVDC
University of Pretoria Energy Efficiency and Demand Side
Management (EEDSM) – National Hub
and Smart Grid laboratory
University of Stellenbosch Energy storage & renewable technology
Power Quality control
Solid stator transformer
8 Sashay Ramdharee, Project Manager, Energy Systems Optimisation. 9 Note from interviews with Dr M Bipath, Dr J Rens, Mr P Groenewald & Mr N Singh
ASSAf 16 January 2017
___________________________________________________________________________
22
In respect of the University of Pretoria, the university hosts the National Hub for Energy
Efficiency and Demand Side Management (EEDSM) within their Centre of New Energy
Systems. Indications are that the Centre attracts many postgraduates from across the country,
as well as international students into the energy efficiency programmes10.
From a broader industry perspective, a number of international companies are investing in
smart grid technologies to improve energy efficiency. These initiatives are mainly driven from
a product development and marketing perspective. Smart grid application suppliers like ABB,
GE, Siemens, Ventyx, Oracle, etc. are investing in smart grid RDI. Electricity distribution
utilities are less committed to invest in technology research, development and innovation
(RDI). However, most of them are willing to report back on their smart grid implementation
experience. The results from three reports are reflected to illustrate the points made above.
Ventyx produced a report during May 2013 which indicated that efficiency improvement in
the electricity value chain can be realised through a smart grid. In the list below the smart grid
applications/initiatives highlighted reflects contributions (directly or indirectly) to energy
efficiency improvement.
Outage reduction
Reduction in equipment operation
More accurate grid/network calculations
Improved capacity management
Improved network predictions
Accurate network loading estimations
Improved mitigation plans
Reduced peak demand
Improved resource utilisation
Improved resource dispatching
Improved reporting and compliance
Improved customer interface
Confidence in grid/network status
Efficient feeder topology
Improved use of feeder capacity
A report produced by ABB11 indicated that the deployment of a smart grid is essential in
providing data to power effective asset health management.
In a presentation presented by Mr Sandile Maphumulo (Head of Electricity, eThekwini) during
January 2012 at the Grid Week in Mumbai, he highlighted the following benefits/efficiency
improvement which they derived from pursuing smart grid related applications. The smart grid
10 Note from interview with Dr M Bipath, SANEDI 11 ABB. Asset management. The next generation maintenance strategies
ASSAf 16 January 2017
___________________________________________________________________________
23
applications/initiatives highlighted reflects contributions (directly or indirectly) to energy
efficiency improvement.
Efficient and cost effective response to emergencies
Improved load management
Improved technical loss management
Improved outage management
Improved network reliability and availability
Improved asset management
The table below represents a consolidated perspective of smart grid related technology
applications that could be pursued to enhance efficiencies in the electricity value chain. The
functionalities contributing directly to energy efficiency includes:
Accurate loss management and loss reduction
Technical loss reduction, network optimisation and energy balancing
Capacity management and network loading
Figure 2: Table of Technology Applications
From the above it is clear that there are numerous opportunities to improve energy efficiency
through the deployment of smart grid technology applications. Energy efficiency as a specific
ASSAf 16 January 2017
___________________________________________________________________________
24
objective should however be included in the current assessment and benefit realisation criteria
of smart grids in South Africa.
6.2 Smart Grid related research and technology development opportunities
While it is true that a substantial portion of the electricity infrastructure in South Africa is old
and requires refurbishment or replacement, it is also true that this is not implying that a smarter
grid cannot be pursued. The investment required in the electricity infrastructure actually
presents the ideal opportunity to pursue the deployment of smart grid related applications. The
DOE is in possession of a substantial report, referred to as the Approach to Distribution Asset
Management (ADAM), which reflects the infrastructure investment requirements. The
selection of the appropriate technology applications can assist the electricity supply industry in
achieving the business objectives. It is however important to note that energy efficiency
improvement might not be the core driver and rather a “benefit by default.” From a South
Africa perspective, smart grid deployment to date was mainly considered from a business
sustainability improvement and service delivery perspective. There is merit in evaluating the
smart grid business case for South Africa, also from an energy efficiency perspective. Moving
energy efficiency to the core of the smart grid deployment could enhance the benefit realisation
and improve the return on the investment.
It is critical for the utilities in the energy sector to define the enterprise Information Technology
(IT) architecture taking into account the technology deployment vision as well as the
Operational Technology (OT) requirements to render an effective electricity value chain. If the
IT and OT requirements are not well defined, it could among others lead to the wrong selection
of the communication protocol and specification of the data transfer capability. Among others
accurate data is important to facilitate effective energy efficiency initiatives. Furthermore, it is
essential in the selection of technology applications that aspects such as; interoperability,
upgradability, security, safety, cost and performance are addressed. The technology
deployment must facilitate two-way digital communication, wide-area situational awareness,
improve energy efficiency, improve network management, load management and improve
customer interface. Without achieving the above, the smart grid will not produce the expected
value.
In selecting technology, it must be kept in mind that the technology supplier and technology
support provider will become a “business partner”. Therefore, this relationship must be kept in
mind when systems, application, business solutions, etc. are researched, developed and
ultimately procured. It is therefore important to pursue smart grid related technology research
in an objective manner and to avoid “dominant influence” from a small group of technology
suppliers/developers.
The study underpinning this report revealed that the current smart grid initiatives in South
Africa are more focussed towards the Distribution business. The underlining objectives, as
stated before, are to improve business sustainability and service delivery while energy
efficiency improvement for the ESI is not a core driver. While the energy improvement
ASSAf 16 January 2017
___________________________________________________________________________
25
efficiency potential to be derived through the smart grid is recognised, the overall potential has
not been quantified. This is an area requiring further research with the objective to assess the
energy efficiency potential associated with the various smart grid applications. Research in this
regard will be of utmost value in the compilation of an integrated smart grid plan or the ESI in
South Africa.
Options which could also be explored to improve energy efficiency through smart grid
deployment include, but are not limited to:
Integrated demand management at utility level
Real-time energy monitoring
Energy portfolio optimisation at utility level by embedding wind and solar
Embedding alternative energy options at utility level to defer network capital
requirements and to improve network loading
Embedding rooftop PV at utility level as part of the utility service offering
Energy storage within the distribution business to improve energy efficiency
Providing Wi-Fi over the utility network as a service to end customers – while the
network is energised i.e. if the power is interrupted the Wi-Fi service is also interrupted
Metering standards and functionality to facilitate nett-metering and/or nett-billing
Develop a model to define the minimum utility back-office support requirements
Development of an integrated smart grid plan aimed at energy efficiency improvement
through appropriate technology deployment
6.3 Landscape of institutions engaged in smart grid research
Internationally, substantial investments are made in respect of smart grid related research. As
stated earlier the smart grid was identified as a key enabler to enhance the ability of utilities to
respond to among others the drive towards a more energy efficient environment and improved
customer service. The United States Department of Energy (DOE), the United States
Department of Energy's National Renewable Energy Laboratory (NREL), the International
Smart Grid Action Network (ISGAN), the National Institute for Standards and Technology
(NIST), the European Commission, the Union of the Electricity Industry–EURELECTRIC and
the Electricity Power Research Institute (EPRI) are among the leading international institutions
devoting resources towards smart grid related research.
From a South African perspective, SANEDI, and Eskom are the leaders in respect of investing
resources in smart grid related research and associated efficiency improvement. Both
organisations have agreements in place with the majority of the universities and universities of
technology in South Africa. Through an industry partnership the smart grid related research is
directed and mainly funded through SANEDI or Eskom. There are also cases where the
Department of Science and Technology (DST) are directing energy efficiency research.
The only body in South Africa which is structured to engage with the ESI from an integrated
smart grid perspective is SASGI. SASGI was established through SANEDI with the primary
objective to provide guidance in respect of the transition to a smarter grid. The SASGI
ASSAf 16 January 2017
___________________________________________________________________________
26
Membership is made up of utility representatives and various government bodies with a direct
interest in the efficient and effective operation of the ESI as well as smart grid deployment.
The current smart grid approach is informed by the SANEDI, Smart(er) Grid Multi-Year
Programme Plan 2014-2018 and the focus is predominantly on the distribution sector of the
ESI. While the importance of climate change and energy efficiency is recognised in the plan,
the plan is not driven from a national energy efficiency improvement perspective. Due to
funding related challenges SANEDI is dependent on grant funding to complement their budget
allocation. The funding constraints resulted in SANEDI adopting an “applied research”
approach. In essence the focus from a smart grid perspective is on research through the practical
execution of defined projects. While this approach is yielding results, there is an urgent need
to invest in advanced research since this will pave the way to be more proactive in deploying
appropriate technology which will best serve the South African requirements. Under the
guidance of the Department of Energy (DOE), SANEDI identified the piloting of various Smart
Grid applications such as: (a) Distributed Power Generation (DG) (b) Revenue Enhancement
(c) Energy Efficiency and Demand Side Management (EEDSM) (d) Advanced Asset
Management (AAM) and (e) Active Network Management (ANM) will help to demonstrate
the benefits of a smarter grid. Furthermore, the European Union (EU) grant funding secured
through SANEDI was earmarked in conjunction with DoE for this purpose. The donors made
the funding available for technology deployment within the electricity utility businesses.
Municipalities were invited to put forward specific technology deployment projects and to
apply for funding support.
While the research being conducted in respect of improving energy efficiency technology
development must be recognised, it is important to note that it is not informed by any defined
national strategic plan. Therefore, it is reasonable to expect that the current research is driven
by specific needs or areas of interest. Potentially the most obvious driver of the smart grid
related research and development must be the Integrated Energy Plan (IEP). It is advisable to
establish an integrated smart grid energy efficiency technology development plan.
ASSAf 16 January 2017
___________________________________________________________________________
27
7. Conclusion
The need for South Africa to be more efficient in the use of energy resources is accepted in
principle. The challenge however is to produce tangible results which will render a better
environment and lead to improved sustainability of the ESI. Based on international best
practices, the absence of large scale deployment of appropriate technology which could be
leveraged to improve an integrated business approach becomes a major constraint. This also
impacts on the efficient use of energy. Furthermore, in the context of a monopoly business such
as the ESI, effective regulation is required to instil the required high performance and
compliance culture.
Internationally a combination of incentives (e.g. funding), penalties and enabling technologies
are used to achieve energy efficiency objectives. The technologies developed and deployed are
underpinned by sound research and in many cases by results obtained through technology
deployment under laboratory conditions. The international success is further enhanced through
the exchange of information and the participation in organisations such as ISGAN, NIST and
EPRI. In addition to the technology enablement it is essential that the market arrangement be
such that it promotes transparency and facilitates a high performance business culture. The
absence of a defined market arrangement/rules and the unwillingness to address it in South
Africa, is not doing the country or the end customers any favours.
Furthermore, from an energy efficiency deliverable perspective, baselines are established and
targets set against defined objectives/expected outcomes.
The operating environment of the electricity utility business changed substantially over the past
decade. It is clear that the traditional business of “buying and selling” energy is under threat.
This implies that new revenue streams must be identified, the business be aligned to
accommodate the disruptive technologies and that more efficient and sustainable practices be
explored. The effective deployment of appropriate technology can significantly contribute to
the improvement in business sustainability. In respect of achieving energy efficiency
objectives, the following are some of the areas where technology deployment was leveraged to
provide early results:
Advanced energy balancing and introduction of real-time statistical metering
Improved management of energy delivered at grid connection points
Deployment of smart meters as part of revenue management improvement
Reduction in network down time
Improved back-office functionality
Improved grid/network visibility
Integrated asset management
See Section 6 (page 12) of this report for examples of how the above options can contribute to
efficiency improvements.
ASSAf 16 January 2017
___________________________________________________________________________
28
A study tour during 2014 to the United States, in which the author participated, to evaluate
smart grid benefits revealed that through the effective deployment of Smart Grids, outages can
be reduced by 20% while outage durations can be reduced by 30% within the first 18 months
of operation. Furthermore, examples were provided where peak loads relative to the loading
on the distribution networks were reduced by 15% and consumers saved up to 20% on their
electricity bill. The centralised Volt-Var control which in effect reduce energy waste by
adjusting voltage and reactive power on distribution lines in response to demand from
customers, presents a favourable option to network management and examples of voltage
lowering of up to 3% was demonstrated. Field force automation results suggest that
productivity improvements of up to 10% for office workers and as high as 18% for field
workers can be achieved with 8 months’ improvement in inspection time.
While there are countries with substantial Smart Grid experience and numerous reports
reflecting the potential benefits to be derived from smart Grid deployment, it must be
appreciated that this is a relatively new concept. Therefore, it is to be appreciated that detailed
results in respect of the assessment of results from completed project and benefits realised are
still in short supply. All indicators suggest however that the Smart Grid presents the potential
to render a more effective industry, a more efficient energy utilisation and a significant
contribution to the protecting of the environment.
ASSAf 16 January 2017
___________________________________________________________________________
29
8. Contact Information
This study was conducted by Dr Willem J de Beer, an independent consultant in the South
African energy sector. Dr De Beer is actively involved in the electricity supply industry for
over 40 years from a strategic as well as an operational perspective. He is accredited through
Carnegie Mellon University, Washington, as a Smart Grid Navigator. He is therefore qualified
to assess the smart grid maturity of an utility and to facilitate utility readiness and ultimately
the rollout of a smart grid. He can be contacted on email at: [email protected] or on +27
82 338 0854.
ASSAf 16 January 2017
___________________________________________________________________________
30
ANNEXURE A: Documents Reviewed
ABB. Asset management. The next generation maintenance strategies
Africa Utilities Technology Council (2016). Telecoms & ICT – The Essential Ingredients to
Create Energy Networks of the Future in Africa
Asia-Pacific Economic Cooperation (2011). Using Smart Grids to Enhance Use of Energy-
Efficiency and Renewable-Energy Technologies. Pacific Northwest National Laboratory 902
Battelle Boulevard Richland, WA 99352 USA
Carnegie Mellon. (2016). Smart Grid Maturity Model. Retrieved December 01, 2016, from
http://www.sei.cmu.edu/smartgrid/tools/
Deloitte (2011). Advanced metering infrastructure cost benefit analysis
Department of Minerals and Energy, “The white paper on energy policy – South Africa
(1998)”, Pretoria, 1998
Electricity for Europe, Active Distribution System Management. A key tool for the smooth
integration of distributed generation. A EURELECTRIC paper, FEBRUARY 2013
Energy Central (2009). Straight Talk About Smart Grid Funding, Planning and Results
Rosario Miceli (2013). Energy Management and Smart Grids. energies
EPRI (2011). Estimating the Costs and Benefits of the Smart Grid. A Preliminary Estimate of
the Investment Requirements and the Resultant Benefits of a Fully Functioning Smart Grid
EURELECTRIC views on Demand-Side Participation. EURELECTRIC, 2011
European Commission (2013). Incorporating demand side flexibility, in particular demand
response, in electricity markets
European Commission (2014). Benchmarking smart metering deployment in the EU-27 with
a focus on electricity
European Technology Platform. (2016). European Technology Platform - Smart Grids. Smart
Grids EU. Retrieved November 28, 2016, from http://www.smartgrids.eu
GreenCape, & Atkins, P. S. (2014). Smart Meters Survey - Localisation and roll-out barriers
Institute of Communication & Computer Systems of the National Technical University of
Athens ICCS-NTUA (2015). Study on cost benefit analysis of Smart Metering Systems in
EU Member States. FINAL REPORT
International Telecommunication Union (2012). Boosting energy efficiency through Smart
Grids.
ASSAf 16 January 2017
___________________________________________________________________________
31
NIST (2013). Technology, measurements and standards challenges for the smart grid.
Oracle (2009). Smart Grids: Strategic Planning and Development
SANEDI, Smart(er) Grid Multi-Year Programme Plan 2014-2018
Scottish Smart Grid Sector Strategy Enabling the Low-Carbon Economy, Creating Wealth
Smart Grid Consumer Collaborative (2012). Consumer pulse and segmentation
The Smartness Barometer – How to quantify smart grid projects and interpret results.
EURELECTRIC, February 2012
ASSAf 16 January 2017
___________________________________________________________________________
32
ANNEXURE B: Individuals Interviewed
Dr Minnesh Bipath, Acting Chief Information Officer, SANEDI, South Africa
Dr Johan Rens, North West University
Mr Nick Singh, Technology Manager, Eskom, South Africa
Mr Philip Groenewald, Manager, Eskom South Africa
Mr Teslim Yusuf, Project Manager, SANEDI, South Africa
Mr Mvuleni Bukula, Executive Manager: Energy, Nelson Mandela Bay Municipality