drakenstein municipality green energy projects 22 april...

Drakenstein Municipality Green Energy Projects

22 April 2015

22 April, 2015 " A place of excellence " 1

Contents

1. Waste-to-Energy Project

a. Location & Background

b. Planning for the Future

c. Technical Processes

d. Finances and Viability

2. Co-Generation within Municipality

3. End

22 April, 2015

" A place of excellence " 2

WASTE-TO-ENERGY PROJECT: LOCATION AND BACKGROUND

22 April, 2015


22 April, 2015


11 June 2015 " A place of excellence " 5

Wellington Intake

Substation from Eskom

Waste-to-Energy Plant

22 April, 2015


Landfill Management

22 April, 2015


• 200t of waste is produced per day • Landfill Site will last until 2020 with good management • Current cost to landfill is R130 per ton of waste • No other site available within all of Drakenstein or in the Cape Peninsula side

of the Cape Winelands District • Remaining alternative is to dump at Cape Town site at R410 per ton (excl

transport)

Remaining Licenced Life of Landfill Site. Estimated to last until 2020

22 April, 2015


Improved Management

WASTE-TO-ENERGY PROJECT: PLANNING FOR THE FUTURE

22 April, 2015


Way Forward

• Reduce volume of waste by diverting recyclable waste

• Separate remaining wet and dry waste

• Extract Methane from wet waste

• Combust all dry waste

• Resultant is only ash to be landfilled

• Can effectively reduce volume of waste to 10% of original volume


Spinoffs

• Methane can be used by burning and generation of electricity. Methane stored to promote generation in peak times.

• Energy from combustion can be used to generate electricity

• Ash can be used to manufacture paving bricks

• Can get to a stage where no landfill has to be done.


Problems with Funding

• Cost of such a plant would be about R450m

• Currently municipalities may not go above 50% gearing ratio. Cannot have debt more than 50% of income.

• Limit of capital funding per annum for Drakenstein is about R350m

• With all other R4b backlogs of projects the WtE plant is out of reach.


PPP Project

• Need to divert risk to establish WtE

• One way is to use a Public Private Partnership (PPP)

• PPP developed: Drakenstein Municipality and Interwaste

• PPP governed by MFMA PPP Regulations

• Section 120 of the MFMA followed

22 April, 2015


Process Thus Far

• Request for Proposals – December 2008

• 8 Bidders / 4 Shortlisted

• Feasibility Studies at own risk and costs

• 3 FSRs received

• Feasibility Reports presented to Technical Committee & SCM –

August 2010

• Interwaste selected as preferred bidder – 23 June 2011 – Council

Resolution

• Memorandum of Agreement signed on 30 May 2012

• Council Section 78(4) resolution taken on 23 April 2014

• Currently busy with EIA


TECHNICAL PROCESSES


Technical Processes

• Waste to energy technologies - Pressing Unit

– The VMpress is a waste pressurizing machine designed to physically separate waste into two fundamental fractions, an organic wet fraction with hardly any non-organics and a solid dry fraction with almost total absence of organic substances.

• Anaerobic Digestion

– Based on evaluation criteria, Anaerobic Digestion was selected as an intermediate WTE technology

• Direct Combustion

– was selected as WTE technology for the refuse that will not be used as feedstock for Anaerobic Digestion, recyclables or inert land filling portion

22 April, 2015


Schematic of Processes


Wet Waste

Dry Waste

VM Press

2MW (Surplus)

8MW (Surplus)

Current Timing of Project


WASTE-TO-ENERGY PROJECT: FINANCES AND VIABILITY



WTE Expenditure to be Covered by

Income

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Municipal Electricity Unit

R1.25/kWh

Municipal Solid Waste Unit 200t/day R200/ton

External Solid Waste Imported

300t/day R200/ton

Balancing of Income

• In order for the WtE plant to be economically viable to the Municipality, the following must apply:

– Electricity Supply cost must be equal or lower than that of Eskom

– Solid Waste Gate fee must not be higher that R200/t


Shortfall Calculation if Eskom prices rise with Current MYPD3


Shortfall Calculation if Eskom prices rise with MYPD3 Adjustment


Conclusions and Closing Remarks for WtE Project

• It is expected that the Eskom effective tariff to Drakenstein will rise above the electricity price delivered by WtE by 2020

• At this point the WtE will just be completed

• Every further year will create a bigger electricity saving

• Only increase to Drakenstein would be landfill waste from R140/t to R178/t, but would be much lower than about R430/t plus transport if delivered to Cape Town site.

• Huge increase in effective environmental management

• Waste landfill can be reduced to zero by manufacturing paving bricks with ash

• Ash can also be used for any landfill needed for construction purposes.


CO-GENERATION WITHIN MUNICIPALITY


Expected Impact of Co-Generation (Embedded Generation) on the Municipal Electricity Network

• If consumers are going to co-generate electricity, the following can be expected:

– Reduced consumption of municipal electricity

– In some cases consumers will be generating electricity back into the grid

– With PV- and Wind Generation the full capacity of the electricity network is required at certain stages, eg windless nights, unless energy can be stored

– Full maintenance will still be needed and the network cannot be shared by any additional usage if energy is not stored.

– Network instability after approximately 30% of added co-generation


Effect of PV on Standard Weekday Curve

83.81c/kWh

56.99c/kWh

82.81c/kW

h

36.16c/kWh


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Load Curve

PV Sun Curve

Changes Needed to make Co-Generation work

• The following administrative changes are needed to

make co-generation work:

– Accurate calculation of the fixed portion of the Electricity

Utility tariffs, eg salaries, loan repayments, any other

expenditure that will remain stable for a month.

– The utility sales tariff must recover this fixed portion from

sales portion of tariffs in order to safeguard sufficient

income to cover fixed expenditure

– The balance of the expenditure would be as a result of

variable usage, such as kWh (energy) and demand kVA)


Variable/Fixed Tariff Portion Split

• Current tariff split, based on annual expenditure: – Fixed: 28% – Variable: 73%

• Theoretical split needed after ringfencing exercises have been done: – Fixed: 32% – Variable: 68%

• Co-Generation tariffs designed to provide the income on this split.

• Allow Consumer to generate into the grid at these values. Municipality sells and purchase energy at the same rate.


Changes made by Drakenstein Municipality

• Changed the Electricity Supply By-Law to allow co-generation as per the NRS 097 standard in order to cater for safety and proper metering.

• Allow the usage and supply of electricity from and to the municipality, special rebalanced tariff available for co-generation

• Credit of the Electricity Account will be provided if total month generation is more than usage

• Consumer must consume all electricity generated within one financial year. Any remaining credit will be cancelled at the last day of the financial year

• Experimental tariffs designed to cope with the above for all categories of consumers



Waste-to-Energy 10MW

Municipal Wind Farm Planned

Eskom Wind Farm in Operation

Large Rooftop PV Installation

Many Applications Received for PV

Investigation For Municipal Building Roof

Top PV

All Large Municipal Buildings Refitted

with LED Lights

drakenstein municipality green energy projects 22 april...

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