Analysis of Energy Mix Scenarios for South African Power Sector, 2016

Ratified Integrated Resource Plan puts Country's Power Supply in Excess of 16,551 MW by 2030

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When creating an Integrated Resource Plan (IRP) for any nation, there are several ways to fill in the supply gap. It could be new builds composed entirely of gas with complementary cogeneration or coal complemented with renewable energy. Up until November 2016, the South African 2010 IRP was the only official document on power objectives. This is often cited in various ways, although it is widely known to be incorrect. As such, decision makers, research, and conferences continually make use of this outdated document. Evidence of its inaccuracy lies in the expected Growth Domestic Product growth rate expected by 2016; the IRP 2010 predicted between 3% to 6% growth in GDP. At this rate, the demand for power predicted in the document is 21% less than what South Africa currently demands according to actual data. A forecast of the power supply is done in conjunction with the demand. This requires updated information such as economic growth, industry sector, population growth, and so on. As the South African economy has seen a slowdown since 2011, the requirement for power has fallen which was not taken into consideration.
A hardcopy document may not be beneficial if it is not updated regularly. Instead, a central, interactive, and up-to-date database will be a more valuable asset to investors, academics, and other players in the private and public sectors.
This research service takes a look at the IRP 2010 and runs various high-level scenarios on combinations of power generation and the initial goal to achieve synchronisation of this generation by 2030. These combinations were chosen based on a lower power demand projection currently seen in the power forecasts rather than the entire range of suggestions. One such scenario takes a look at the power generated should the ambition of the IRP 2010 come to fruition. While the government aimed to produce 89,532 MW of power in 2030, the actual production only reaches 66,841 MW – this is 25% less than the original plan. An updated IRP is vital to understand the energy landscape, but while the public waits for the document, data modelling can be done in the meantime. This reports attempts to do that on a high level.
The base year for the study is 2016, with the forecast period being 2017-2060.
Important note: As the latest IRP for 2016 will only be signed off by the South African Cabinet in Q2/Q3 of 2017, this report does not refer to this unofficial update. Furthermore, although it is vital to consider levelised cost of energy when comparing technologies, this report does not deal with the cost side of energy planning.

Table of Contents

1. Executive Summary
Key Findings
Future IPPs
Power Supply Forecast until 2060
Comparison of Scenario Supply Forecast until 2060
Levelised Cost of Electricity
2. Introduction
Objectives of the Analysis
Scope of Research
Geographical and Technological Scope
3. Methodology
Research Methodology
Assumptions
4. South Africa Energy Overview
South Africa—Economic Analysis
South Africa—Economic Growth
South Africa—Power Sector Analysis
History of the IPP Procurement Programme
Future IPP Programmes—Coal Base Load IPP
Future IPP Programmes—Gas to Power
Future Programmes—Nuclear Build Programmes
Future IPP Programmes—Cogeneration
Future IPP Programmes—Small, Large IPP, and Solar Parks
5. Scenario 0—Business as Usual (BAU)
Introduction to Managing the Scenarios
Power Supply Forecast until 2060—BAU
Forecasting the Demand in Power (MW)
Power Supply at a Glance until 2035—BAU
Power Supply Forecast until 2034—BAU
Future IPP Programmes—Gas to Power
Demand
Future IPPs
6. Scenario 1—Renewable Energy and Coal (REC)
Justification for REC
Power Supply Forecast until 2060—REC
Power Supply at a Glance until 2035—REC
Notable Insights into REC
7. Scenario 2—Gas and Cogeneration (GCG)
Justification for GCG
Power Supply Forecast until 2060—GCG
Power Supply at a Glance until 2035—GCG
Key Insights into GCG
8. Scenario 3—Nuclear (NUC)
Justification for NUC
Power Supply Forecast until 2060—NUC
Power Supply at a Glance until 2035—NUC
Key Insights into NUC
9. Scenario 4—All of the Above (AOA)
Power Supply Forecast until 2060—AOA
Power Supply at a Glance until 2030
How this Aligns with Other Forecasts
Power Consumption until 2015
10. Scenario Comparison
Comparison of Scenarios
Conclusions
Key Notes on the Scenarios
Conclusion—Power Supply Scenarios
Conclusion—Modelling the Data
Legal Disclaimer
11. Appendix
Abbreviations
12. The Frost & Sullivan Story


List of Figures & Charts

1. Segment-wise Breakup of Services Sector, South Africa, 2015
2. Segment-wise Breakup of Industry Sector, South Africa, 2015
3. Comparison of the Scenarios’ Notable Data Points, South Africa, 2016


1. Forecast of Energy Supply, South Africa, 1952–2060
2. Renewable Energy & Coal, South Africa, 1952–2060
3. Gas and Cogeneration, South Africa, 1952–2060
4. Nuclear, South Africa, 1952–2060
5. All of the Above, South Africa, 1952–2060
6. Quarter-on-Quarter Economic Growth, South Africa, 2012–2016
7. Proposed Total Generating Capacity by Power Source, South Africa, 2030
8. Project Allocation Breakdown, South Africa, 2015
9. Forecast of Maximum Planned Power Supply, South Africa, 1952–2060
10. Forecast of Renewable Energy Power Supply, South Africa, 1952–2060
11. Results of Low, Moderate and High Power Demand Scenarios, South Africa, 2000–2040
12. Forecast of Power Demand Compared to a Shortfall, South Africa, 2015–2034
13. Reasons for Reduction in Power Demand, South Africa, 2015
14. IRP’s Power Supply Forecasts, South Africa, 2015
15. Power Supply Forecast, South Africa, 1952-2060
16. Results of Low, Moderate and High Demand Scenarios, South Africa, 2000-2040
17. Power Supply Forecast, South Africa, 1952–2060
18. Results of Low, Moderate, and High Demand Scenarios, South Africa, 2000–2035
19. Power Supply Forecast, South Africa, 1952–2060
20. Results of Low, Moderate, and High Demand Scenarios, South Africa, 2000-2040
21. Forecast of Maximum Planned Power Supply, South Africa, 1952–2060
22. IRP 2010 Power Allocation by Power Source, South Africa, 2010
23. IRP 2010 Power Allocation by Power Source, South Africa, 2010
24. IRP 2013 Update Power Allocation by Power Source, South Africa, 2013
25. IRP 2013 Update Power Allocation by Power Source, South Africa, 2013
26. Forecast of Maximum Planned Power Supply, South Africa, 2010–2015



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