PV-BESS hybrids make economic sense as they approach grid parity

Significant economic benefits can be achieved by switching to solar and battery hybrid power for heavy energy users connected to the South African grid. This was highlighted in an award-winning paper “Grid parity analysis of a PV-BESS hybrid case study” at EE Publishers’ recent SA Energy Storage conference which was held at Emperors Palace near Johannesburg.

Using a proprietary technical and economic model for the optimal sizing of a grid-connected PV-BESS (solar photovoltaic and battery-based energy storage system) combination for a mine which is currently being developed in the Northern Cape, Juwi Renewable Energies analysed the grid-parity dynamics based on the levelised cost of electricity (LCOE) concept to examine the timings and conditions needed for a PV-BESS hybrid system to reach grid parity.

Over the last few years, PV systems have developed into a highly competitive power generation option, and now BESS systems can cross the last hurdles of ensuring PV power is fully dispatchable and not totally reliant on the availability solar irradiation.

Fig. 1: A hybrid wind and solar PV farm.

Battery technology and manufacturing capacity have developed rapidly in recent years mainly driven by e-mobility. BESS costs have reduced to levels where PV plus battery can provide dispatchable power at competitive prices. One noteworthy example is the Hornsdale Power Reserve in South Australia. The 100 MW/129 MWh BESS is co-located with a windfarm and additionally provides exceptional high-speed ancillary services to stabilise the grid. The advancement of BESS technology and continued cost reductions in PV and BESS, lead to the forecast that a growing number of high energy users such as mines or grid operators will find it beneficial to opt for energy or ancillary services from PV-BESS systems.

Fig. 2: The Hornsdale power reserve project in South Australia.

A cost and SWOT (strength, weakness, opportunity and threat) analysis study, conducted by Zharan, on the integration of renewable energy (RE) into the mining industry, with research by Navigant, shows that the number of mining projects which will use renewable energy technologies for their operations is set to increase. Navigant reports that by 2020, mining operations worldwide will deploy more than 1438 MW in renewable energy. This equates to an expected deployment of 500 MW RE projects for the mining industry in the next two years.

Technical and economic models were used in an ongoing case study to determine the optimal sizing of a grid-connected PV-BESS solution for a mine situated in South Africa’s Northern Cape with an estimated mine-life of 13 years and an average load demand of 35 MW. An analysis, based on the LCOE concept to examine and determine the timings and conditions under which this mine could supplement its energy needs with solar energy and battery technology without incurring higher cost or a decrease in reliability of power has been undertaken.

Key conclusions of the case study

Based on Eskom’s Megaflex electricity tariffs, the mine’s energy demand and at the given location, a PV power plant, connected behind the meter, could provide substantial cost and CO2 savings. The company’s system design and modelling shows that behind-the-meter solar PV systems are already cost effective compared to the power utility’s existing Megaflex tariff.

This detailed analysis of a mining project in development shows that for a 42 MWp behind-the-meter PV plant, the estimated cost and CO2 savings over the lifetime of the project is R2,45-billion –  equivalent to 61% of the grid electricity cost and a 33% CO2 savings of 95,439 tCO2e per year.

The advancement of BESS technology and the continued cost reductions for PV and BESS systems lead to a fast-approaching grid parity by about 2023. This, in turn, will unlock an even higher percentage of clean solar power.

At the mine where the investigation was conducted, the PV-BESS system could grow to 82 MWp by adding an additional 33 MW/76 MWh system which could save the mine R1,36-billion within eight years. Although the study provides only a preliminary assessment, and a detailed and in-depth analysis is required for each and every site, tariff and revenue structure to conclude an appropriate technology mix, the company has seen significant interest in hybrid systems by the commercial and industrial sector and most specifically, the mining sector, following the successful construction and commissioning of the world’s largest fully off-grid solar-diesel-battery storage plant at the De Grussa copper and gold mine in 2016. This system comprised a 10,6 MW PV coupled with 6 MW of battery storage and 19 MW of diesel generation.

Contact Juwi Renewable Energies, Tel 021 831-6100, info@juwi.co.za

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