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Submission on the cogeneration ofelectricity

25 July 2013

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• Introducing Prana Energy

• The type of proects co!ered by our submission

• "haracteristics of #aste Energy $eco!ery proects

• #hat %e need from &o!ernment

• 'uestions

AGENDA

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Introducing Prana Energy

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Prana Energy

• Prana Energy started de!eloping cogeneration proects in

200()

• #e are considered to be one of the leading proect

de!elopers in the cogeneration space)

• #e formed a J* %ith E++aro in 200, -.E++aro /nSite

%ith the specic aim of the J* being de!eloping

cogeneration proects as these proects %ere percei!ed to

be the .lo%hanging fruits bac4 then)

• E++aro /nSite submitted cogeneration proects %ith a

combined capacity of 30 6# into Es4om7s Pilot 8ational

"ogeneration Programme -.P8"P in 200, but %ithdre%

these due to a poor PP9)

• #e ha!e roughly 2006# of proects %hich can be

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The type of proects

co!ered by our submission

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The type of projects covered by oursubmission

"ombined ;eatand Po%er

-";P

Electricityreco!ered from

%aste

•Pulp and Paper•Sugar•<iomass•8atural gas•Etc=

The cogeneratorhas signicantcontrol o!er the fuelsource

The cogenerator has nocontrol o!er the fuelsource at the end of anindustrial process•>errochrome smelters•>erromanganese smelters•"ement 4ilns•Steel manufacturing•Etc=

8ot co!eredby our

submission

"o!ered byoursubmission

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"haracteristics of #asteEnergy $eco!ery proects

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Cogeneration from wasteenergy recovery• 'uic4 to implement relati!e to ne%build coal -circa 2:

months

• 9s .green as electricity from %ind? solar and hydro @ i=e= it

reduces carbon emissions

• It also typically ha!e further en!ironmental benets @ e=g=

reduced air pollution

• The grid connection points are already in place @ no

additional transmission infrastructure reAuired

• The electricity is not e+ported bac4 into the grid as

generation is typically less than the onsite consumption @

i=e= reduced grid losses

• >antastic grid alignment -almost li4e baseload @ see ne+t

slide

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Fantastic grid aignment

If the demand from theindustrial process on Es4omis ;I&;? the cogeneration

plant produces 9 B/T ofelectricity

If the demand from theindustrial process on Es4omis B/#? the cogenerationplant produces BESSelectricity

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Economic Comparison ofTechnoogies

c!"#h

Avoidpea"ing !mid merit

pantcosts$

Avoiddeep gridconnectio

n costs

%eductionon

transmission osses

Solar -P* 1:0C & ! & ! &

Solar -"SP 1(5C &

! &

! &

#ind 100C & ! & ! &

;ydro -small 10(C ! & ! &

<iogas D0C ! & ! &

<iomass 1:0C

! &

! &8atural &as D0150CC

! &

! &

"oal D0120CC ! & ! &

Pea4ing-diesel

320:20CC ! & ! &

Energy'()*+(

C <ased on $EIPPP round 3 capsCC Estimates

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#hat %e need from&o!ernment

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#hat we need fromGovernment1= #e need continuity of policy====

• #e ha!e been de!eloping 2 cogeneration proects

-#aste Energy $eco!ery %ith generation capacity of

(06#)

• These proects are only !iable if there is an I6 type

subsidy a!ailable but gi!en that this %as the case until

9pril of this year? %e spent in e+cess of $15m on

de!eloping these proects)

• In 9pril? the I6 subsidy %as abruptly ta4en a%ay as

part of 8E$S97s 6FP3 ruling)

• 8o alternati!e is being oGered=== i=e= a total discontinuity

in policy

• These proects may ha!e to be terminated at a time

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#hat we need fromGovernment ,cont-.

2= The cheapest H Auic4est H best %ay to ma4e these proectshappen is a onceoG up)front capita subsidy

This is similar in nature to the I6 subsidy %hich e+isted atEs4om for cogeneration proects until 6arch H 9pril this year

and %hich aready enabed a number of cogenerationprojects successfuy

/ur reAuest is that the I6 subsidy %hich pre!iouslye+isted %ithin Es4om be re)activated -!ery easy to do

until such time as an alternati!e mechanism e+ists -as perthe 8E$S9 ruling

/ur further reAuest is that su/cient funding be madeavaiabe to Es"om -from an alternati!e source and thatthey be gi!en a temporary mandate to taior the amount

of the 0D1 subsidy to enable these proects as long as

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2p)front capita subsidy

Subsidy ma4es the priceof cogeneratedelectricity comparableto that of Es4om

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2p)front capita subsidy ,cont-.

• "heap==== the I6 subsidy at 9$ 5=25mH6# %or4s out toroughly D cH4#h for the Prana proects already submitted

to Es4om= It is far cheaper than anything else but the siKe

of the subsidy reAuired %ill diGer from proect to proect

•

'uic4==== the I6 infrastructure and legal frame%or4already e+ists at Es4om and is being used for other

energy eLciency proects

• 9lignment of interest==== There is perfect? selfregulating

alignment of interest as the o%ner of the cogenerationplant has to pro!ide the rest of the capital @ i=e= there is a

!ery strong incenti!e to ma4e sure the plant produces

electricity

• 9 pro!en mechanism=== It already %or4ed in South 9frica

and is %idely used internationally

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Than4 you

130725 Prana

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