Fish River River Hydro Scheme by Gaia Power Group
Jul 6, 2013
Hello Ms. Megun, Thank you for your submission and congratulations on your selection as a finalist for the final judging round. To improve your proposal we have the following comments/questions that we would like you to address: 1. What is the scalability of this project? Could it be applied across South Africa? If so what are the gross economic/climate effects of the project? 2. What is the comparative electricity rate that ESKOM charges? 3. Is there any room to work alongside the existing utility providers (ESKOM) to sell wholesale energy in exchange for guaranteed off take/ investment? 4. Would Gaia Power eventually act as a Hydro power utility company? If so, what is the long-term scalability of the technology/ business plan? Please consider these comments/questions in your next draft. Thanks, CoLab Judges.
Jul 15, 2013
Dear Judges, Thank you for your comments. As far as space would allow we have incorporated most of our responses into our proposal. Below for your convenience are our direct responses. 1. What is the scalability of this project? Could it be applied across South Africa? If so what are the gross economic/climate effects of the project? The methodology and approach of the system is to use the forward motion of water together with a small fall to generate electricity in as an inexpensive way as possible so as to make it available to many all over the world. The combination of forces generates power at between 2-4 times the amounts of power of standard hydro systems for the same fall. The simplicity, easy of construction, overall low cost, long life, short repayment period, safety, protection of equipment as much as possible from damage, was the main design drivers. The system is capable of being adapted very easily to work in many different streams of water ranging from largish streams to mature rivers. See table below. The main advantage is that it does not stop the river from flowing as does standard hydro systems. This supports downstream ecology as well as irrigation systems etc. There are literary millions of places all over the planet where a low level weir (from 1 to 3m) could be placed in a stream or river. This is just the way that nature is all over the planet. In each of these places a small power plant could be erected. As nature would have it, it usually supplies another point a little way downstream where another power generation plant of same capacity can be erected after an elevation fall of about 3-4m. Thousands of such small plants can collectively generate a large amount of power for the national grid or could supply a small community as a stand-alone grid. As we all know that the flow rate of rivers and streams vary on a constant basis. This is no problem for the system to still work, it has the ability to still work at variable flow rates and yet deliver power at the correct frequency in the case of AC systems all be it at a lower power rate. For example if a system has been designed to work at a flow rate of 4m^3/s and the river flow drops to 2m^3/s it would still work. This is unlike standard hydro systems where they would be designed to work at 2m^3/s and ignore the rest. This is wasted energy and wasted water not to mention inefficient. The weir would channel the water into a canal (that has been designed using composite materials to be very easily erected by non-skilled people – very little to no civil works) and the canal would run alongside the river at a lesser elevation than the river. Where there is sufficient fall back to the river between the canal and the river (optimally about 3m but can be anywhere between 1 and 10m or more) the water will be fed back into the river via a low cost turbine generating electricity. To attain a 3m fall is very easy as all you have to do is play between adjusting the weir height and the elevation fall of the river or stream immediately after the weir. The canal system is so positioned so as to be out of the way in times flood. Should the terrain support it then our patented step generation process should be used as it producers more power than single stage uses. The multistage system can be applied to standard hydroelectric dams and would increase the output from the dam due to the way the technology works. This increase could be anywhere between 2-4 times the current output of the dam and is affected by factors such as the height difference between dam and ensuing river as well as the amount of water flowing from the dam. Taking the above into account and the map of the study done by the CSIR, Eskom and Dept. of Minerals and Energy below one can clearly see the prospects for Gaia Power and entrepreneurs to build their own small power plant and harness this potential all over the country and in Lesotho (a country that desperately needs electricity). In South Africa there are 284 rivers, many of them perennial. The country has an average elevation difference from the Highveld to the ocean of 2100m. There are opportunities everywhere. From the map below one need to understand that the grading was created with standard hydro thinking in mind. This is definitely not the case using the Stream Dragon as at least twice the power output could be attained. This is clearly shown in a map, which can be downloaded at https://www.hightail.com/download/bWJvb256Q0NlaFRyZHNUQw To give an example of the power output of the system see table below. Potential power output for different flow rates and fall Water flow quantity m3/s 50.0 45.0 30.0 22.5 15.0 10.0 7.5 3.5 2.5 2.0 1.5 1.0 0.8 0.5 0.4 0.3 0.2 2m fall Power Kw 4 081 3 560 2 118 1 443 845 662 348 128 97 73 52 31 22 14 11 8 5 3m fall Power Kw 4 925 4 309 2 590 1 782 1 057 815 445 168 126 96 69 42 30 19 15 11 7 4m fall Power Kw 5 698 4 995 3 026 2 096 1 254 956 536 207 154 118 85 53 37 24 18 13 8 Output River Size Per Turbine 6MW Major river will be used in multiple channels 5MW Medium river - large water flow 4MW Medium river - large water flow 3MW Medium River 2.1MW Medium River 1.5MW Medium River 1MW Medium River 0.75MW Small river 0.35MW Small river 0.2MW Small river 0.1MW Large stream 50kw Large stream 30kw Medium Stream 20kw Small stream 13kw Small stream 5kw Small stream 2. What is the comparative electricity rate that ESKOM charges? Gaia power can provide power at rates less then Eskom but on recommendation of the regulating body NERSA we have linked our rate to Eskom WEPS active energy charge. Eskom has a pricing process called WEPS (wholesale electricity pricing system). It is the standard pricing that it uses to cost its power to all the different stakeholders in the country. It is a sort of averaging system of costing across all of its power generating system, the largest being coal. This average costing system is currently the second cheapest in the world beaten only by Canada due to its extensive hydroelectric systems. Gaia Power using its Stream Dragon technology is able to produce renewable energy power profitably at the current rate. This is a first for any renewable energy company in South Africa to be able to achieve this and is a major feat when compared to other countries around the world. In this light we can therefore produce renewable energy at the second cheapest rate in the world. With reference to Eskoms WEPS energy charge tariff, (a worksheet that provides a copy of Eskom's 2013 WEPS pricing can be downloaded at https://www.hightail.com/download/bWJvb242V3JENlFYRHNUQw), Gaia Power would supply at the “active energy charge” for the > 900km transmission zone and at < 500V price range. The average rate of these prices over peak, standard, high and low demand seasons is R0,51 for 2013. Thereafter we have increased our price by 8% (NERSA has approved a 8% price increase for Eskom over the next 5 years) per annum over the next 5 years and by 5% thereafter in line with expected inflation. The WEPS energy charge is the rate that Eskom pays to their generation department before distributing the electricity to local authorities, non-local authorities and businesses. Eskom then uses this as the base rate and adds other charges depending on the customer. For local authorities/municipalities they charge in addition to this base rate, a transmission network charge, electrification and rural subsidy, reactive energy charge, distribution network charge, reliability service charge, environmental levy, service charge and an admin charge. All these “extra” charges significantly increase the price that Eskom’s customers pay. With Gaia Power, municipalities would only pay the active energy and the transmission network charge. All the other charges that they would have paid Eskom fall away. Those municipalities who have their own network in place will only pay the “active energy charge”. This demonstrates that there will be a cost saving to the municipalities to whom we will supply and the advantage is significant to them. Should we supply Eskom we will provide energy to Eskom at the same rate (2013 - R0,51) and we do not require any subsidies/feed-in tariffs/incentive programs. 3. Is there any room to work alongside the existing utility providers (ESKOM) to sell wholesale energy in exchange for guaranteed off take/ investment? Once our generation license has been fully (currently it is provisionally approved until funding is confirmed) approved by the regulating body NERSA, Eskom is obliged to buy power from us. At this stage we will have to present our approved license to Eskom and we can then sign a PPA. We would supply Eskom at the Eskoms WEPS energy charge as indicated above. At the same time we can also compete with Eskom locally and internationally. South Africa and the SADC countries are in desperate need for power at reasonable cost. Eskom has now started to price itself out of market due to its steep increases planed over the next five years where prices are due to its steep increase planed over the next five years where prices are due to increase by between 8-16% compounded. This fact has been recognised recognised by the South African Government and as a result has opened the market to the introduction of renewable energy power production in the country through a process known as REEIPP. However the current costing of this power is above the current Eskom WEPS rate and is therefore subsidised. We do not need this subsidisation and are able to compete with Eskom to local buyers such as municipalities. The law and regulations also allows for this eventuality to take place right now. It has not been utilised as current renewable energy suppliers are above the WEPS rate. The law also allows for a producer to connect to a consumer and arrange their own PPA (Power Purchase Agreement) external to ESKOM and if they use the network then a wheeling charge would be paid to Eskom. Thus therefore there is an open door for business in South Africa and the SADC ((South African Developing Countries). 4. Would Gaia Power eventually act as a Hydro power utility company? If so, what is the long-term scalability of the technology/ business plan? Gaia Power would eventually act as a renewable energy company. The main focus will be on largish rivers in selected concentrated areas and improvement to hydroelectric dams output capacity. All technologies are protected by IP registration. In addition to acting as a power utility, Gaia Power will also license the technology as well as sell standalone river hydro systems to entrepreneurs and small to medium business. This system fulfils a unique place in the power generation possibilities. There are many rivers in South Africa, Africa and the world that have permanent water flowing. These vary according to season. The system being modular and adaptive can accommodate varying water flows with ease within a singular turbine. It is modular meaning that when water flow is high multiple parallel systems can be used and when water flow low less is used. Because of it modular nature it is easily scalable and replicable. The system will first be placed along the Fish River as already mentioned in our proposal. Once this system is operating it will repay its investment in just over 3 years. Thereafter all expansion will pay for itself and we will extend the system as follows: In South Africa Orange - 4 021 GWh to 13 333 GWh per annum In Zambia, Namibia, Zimbabwe we plan to tackle the following rivers providing power to local communities and national grids: Kafue – 39 420 GWh per annum Kunene - In process of investigation Zambezi – In process of investigation The total of the Fish river and Orange River output amounts to between 5 696 to 15 062 GWh per annum. This accounts for 56.96% to 150.62% of the SA government’s 2013 renewable energy consumption target of 10 000 GWh per annum. The reduction in CO2 being 3% (±16m tons) of the country's total emissions (506m tons 2010). It does not include other rivers in SA like the Vaal, Tongaat, Umgeni, Oliphant, etc. As already mentioned there are 284 rivers in South Africa, many are perennial and the country has an average elevation difference from the Highveld to the ocean of 2100m there are many opportunities all over the country to be taken advantage of. The collective production of power in the small units all over the country will be huge. What amount exactly we don’t know but it will certainly in our estimation be more than a coal driven power station in South Africa. This would our way of proving that renewable energy can make a big difference in the world and that it can be done at reasonable price. It can also affect the very demographics of the way society has concentrated themselves across the world. For now power would be available almost everywhere at reasonable price. The long-term vision is to expand the system into the SADC region, and then the rest of Africa followed by other countries internationally. Internationally our target areas are Europe, America, South America, India, China, Asia, Australia, Russia and Indonesia. Of course as is usual, with each extension/addition to the facility, economies of scale are reached, the learning curve becomes less steep and capital costs reduce. Warm regards Janietzche
Jul 15, 2013
Thank you Janietzche. We will consider your additional comments in our review process. Best, CoLab Judges
Aug 26, 2013
This is outstanding. I see that your work would only have moderate requirement for batteries, but we hope to be there in a while. As part of our marketing, we plan to organize maps of renewable energy sources and code them for which are best in any given area. This would give a large boost to your marketing efforts. We look forward to allying with you when the time comes, and will be following your success with interest. Mark Roest, SeaWave Battery.
Aug 26, 2013
Hi Mark, Thanks for your comment on our proposal. Yes we would definitely be interested in co operating with you and see how your batteries could add value to our offering. Look forward to our further communication. Warm regards Janietzche