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CONTENTS

Meetings, Workshops and Conferences .. 1

SAPP Quality of Supply Working Group Study Tour to USA ...................................................... 1 SAPP Markets Study Tour to USA ................... 2 China Africa Power Sector Forum .................... 2 Deployment of Renewable Energy Solutions: Challenges and Opportunities .......................... 2

System Planning ........................................ 3 SAPP Renewable Energy Workshop ............... 3 Transmission Maps Development .................... 3

System Operations .................................... 3 System Disturbances ....................................... 3

Electricity Trading ...................................... 4 Traded Volumes ............................................... 4 Market Clearing Prices ..................................... 4 Market Revenues ............................................. 4

Update on SAPP Projects .......................... 5 Botswana – South Africa (BOSA) Interconnector Project ...................................... 5 Inga – Soyo Interconnector .............................. 5 Angola - Namibia (ANNA) Interconnector Project .............................................................. 5 Mozambique – Malawi Interconnector Project . 5 Zambia – Tanzania Interconnector .................. 6 Kolwezi – Solwezi Interconnector Project ........ 6 Luapula Hydro Electric Power Scheme............ 6 Environmental Progress Status ........................ 6 Regional Transmission Infrastructure Financing Facility .............................................................. 7

Environmental Corner ............................... 7 Clean Energy Fund for SAPP .......................... 7 SADC PCB Elimination Project ........................ 7 World Bank ESMF Training .............................. 7

Upcoming Events ....................................... 8

Meetings, Workshops and Conferences

SAPP Quality of Supply Working Group Study Tour to USA

The SAPP Quality of Supply Working Group (QOSWG) carried out a study visit of energy sector organisations in the United States of America from 4 to 8 November 2019. The following organisations were visited: Xcel Energy (a power distribution utility), the state energy regulator, and the National Renewable Energy Lab (NREL) in Denver, Colorado. In Washington, the working group received expert presentations from officials from PJM, a transmission system operator, and Delloitte. Focus areas of the study tour were standards and measurements of power quality, mitigation of power quality problems emanating from renewable energy sources, battery storage technologies, and connection requirements.

Southern African Power Pool

Energising the region for economic development

MONTHLY

REPORT

November 2019 Issue No. R11-19

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Members of the QOSWG during the study visit in the United

States of America

SAPP Markets Study Tour to USA

The SAPP Markets Sub-Committee (MSC) undertook a study tour to USA during the month. The objective of the study tour was to familiarize the MSC with the development and operation of balancing markets, the development and operation of the market surveillance function, the mechanisms that can be used to manage power exchanges between power pools and the leveraging on the market in the financing and development of transmission projects that support regional trading. The tour was coordinated by Power Africa and funded by the World Bank under the AREP program.

China Africa Power Sector Forum

The 2019 Global Interconnection & China- Africa Power Conference was held in Beijing, China from 5th to 7th November 2019. Delegates also had the opportunity to visit a 500 kV underground substation and an 800 kV HVDC substation in Shanghai as well is

the Three Gorges Dam in Yichang. The conference theme was around an important platform of experience exchange, technological displays, projects cooperation, investment and financing. The conference was organised by the Global Energy Interconnection Development and Cooperation Organisation (GEIDCO).

SAPP CC Executive Director and President of Global

Energy Interconnection Development and Cooperation Organisation

Deployment of Renewable Energy Solutions: Challenges and Opportunities

From the 18th to 29th November 2019, the Planning Engineer and Operations Engineer attended an Advanced Training Course in Milan, Italy. The training course was organised by the Enel Foundation in partnership with MIP Politecnico and SDA Bocconi School of Management. The main aim of the Advanced Training Course was to deepen theoretical skills and knowledge on Africa’s renewable energy future and also

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providing participants with a set of technical, economic and regulatory core competences and advanced tools to assess and deploy the most appropriate solutions in different energy contexts for an efficient and effective integration of renewables in emerging electricity markets.

Students after lessons on power quality and storage, grid operation, integration and strategic planning at the CESI headquarters in Milan, Italy

System Planning

SAPP Renewable Energy Workshop

The second workshop on the SAPP Renewable Energy Study took place from 20-21 November 2019 at the Capital West Hotel in Sandton, South Africa. The objective of the workshop was to discuss the outcomes from the draft report on Part 1 of the study that is focusing on the assessment of renewable technologies on the operations in SAPP.

Transmission Maps Development

The SAPP continued with the development of Grid maps for generation stations, transmission lines and substations. The project is expected to be completed in December 2019.

System Operations

System Disturbances

In the month of November 2019, five (5) SAPP system disturbances were reported. In the first one, an HVDC converter tripped in DR Congo, causing power and voltage fluctuations on the interconnection. The second is under investigation. It was characterised by tripping of generators and interconnectors in the Zimbabwe, Zambia and DR Congo grids, leading to islanding of Zambia and DR Congo grids. In the third one, the interconnection between Zambia and DR Congo tripped on underfrequency protection and most areas in DR Congo lost power supplies due to operation of the automatic underfrequency load-shedding scheme. In the fourth disturbance, a key transmission line tripped in Zambia. In the last one, the 400 kV interconnector between South Africa and Botswana tripped on earth fault. Refer to figure below for the general outlook of reported system disturbances.

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Electricity Trading

Traded Volumes

Trading on the market was lower during the month of November 2019 when compared to October 2019. Total traded volumes on the Day Ahead Market (DAM), Intra-Day Market (IDM), Forward Physical Monthly Market (FPM-M) and Forward Physical Weekly Market (FPM-W) decreased by 33% to 172 GWh in the month of November 2019, from the October 2019 volume of 256 GWh. The November 2019 traded volume was lower by 20% when compared to November 2018 in which traded volumes were 216 GWh.

Market Clearing Prices

Non-Off-Peak prices remained unchanged from the October 2019 price of 10.0 USc/KWh. Off Peak prices increased by 60% from 3.5 USc/KWh in October 2019 to 5.6 USc/KWh in November 2019.

The average price for the peak period was higher by 42% at 15.9 USc/KWh in November 2019 from the September 2019 figure of 11.2 USc/KWh. Standard period average prices decreased from the October 2019 figure of 7.6 USc/KWh to 8.0 USc/KWh in November 2019. The average off–peak price marginally decreased from 3.4 USc/KWh in October 2019 to 3.3 USc/KWh in November 2019.

The monthly average DAM market clearing price (MCP) was higher during the month of November 2019 at 7.4 USc/KWh when compared to 6.2 USc/KWh recorded in October 2019.

Daily Average MCP prices from March 2019 to

November 2019.

The average IDM price for the peak period for the month of October 2019 was 15.7 USc/KWh, up from the October 2019 figure of 7.2 USc/KWh. The average IDM price for the standard period in October 2019 was 7.6 USc/KWh. The average off-peak period price marginally decreased from 2.8 USc/KWh in October 2019 to 2.7 USc/KWh in November 2019.

Market Revenues

A total of USD 12 million was exchanged on the competitive market during the month of November 2019 when compared to a total of USD 16 million exchanged in October 2019. The change is mainly attributed to change in traded volumes in the month of November 2019 when compared to October 2019. USD 11 million was exchanged on the competitive market during the same month of November in 2018.

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Update on SAPP Projects

Botswana – South Africa (BOSA) Interconnector Project

The Final Draft Feasibility Report was submitted on 21st November 2019. The Risk Register and Draft Project Information Memorandum (PIM) will be submitted in January 2020.

Inga – Soyo Interconnector

The Inga – Soyo Interconnector between DRC and Angola is being promoted by the two utilities SNEL and RNT. The SAPP was appointed as Project Coordinator. A Project framework has been prepared and at the Project Management Committee meeting held on 13 November 2019 the two parties agreed to the terms of reference.

Angola - Namibia (ANNA) Interconnector Project

The Draft Final Feasibility Report was submitted on the 13th September 2019 and

comments were received from DBSA on the 15th October 2019 and RNT on the 15th November 2019. Part 2: Feasibility Study activities have been completed except for the Preliminary Design Report and ESIA studies. The Environmental and Social Impact Studies for Namibia and Angola are being conducted in parallel. The following is the progress:

Namibia ESIA Status:

• ESIA documentation validation workshop was held in October 2019 in Johannesburg, South Africa.

• Draft ESIA Report approved for public review by SAPP (13 Nov 2019).

• Draft ESIA Report disclosure between 26 Nov 2019 and 10 Jan 2020. This disclosure period will also comprise of Stakeholder Engagement Meetings to be held from 10 to 15 Dec 2019 in Namibia.

Angola ESIA Status:

• The ESIA documentation validation workshop was held on 27 Nov 2019 in Luanda, Angola.

• The English ESIA Report and Appendices (Environmental and Social Management Plan (ESMP), Resettlement Policy Framework (RPF) and Vulnerable Groups Plan) are currently undergoing final review and will be submitted to SAPP for client review on 9 Dec 2019.

• The Portuguese ESIA Report & ESMP will be submitted for client review by 11th Dec 2019.

• The Portuguese Resettlement Policy Framework (RPF), Vulnerable Groups Plan and Stakeholder Engagement Plan will be submitted on the 13 Dec 2019.

Mozambique – Malawi Interconnector Project

Financial Close for the Project has now been reached. Some of the financial agreements have already been signed, such as KfW. In addition, all financial agreements with the Norwegian Government and World Bank have already been signed by the respective Bank's Management and the Agreements are in the process for counter signatures by the representatives from the Governments from both Mozambique and Malawi. The signing process for all the Agreements is expected to be completed in December 2019. With regards to the technical preparatory activities, the Tender Agent will commence their assignment by the end of December 2019 and thereby launching the Bid Floating

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for the Construction Contractors by the end of March 2020. The respective Tender Documents are expected to be approved by the Financiers between February and March 2020. In the meantime, preparation for the Resettlement Action Plan (RAP) activities is underway and implementation of the same RAP should commence in April and May 2020 and will run in parallel with construction activities which should commence by the end of last quarter 2020.

Zambia – Tanzania Interconnector

The Draft Environmental and Social Impact Assessment (ESIA) and Environmental and Social Management Plan (ESMP) were submitted for comments. A validation workshop was held on the 30 and 31 October 2019 in Lusaka, Zambia.

Biological surveys for Biodiversity Management and Monitoring Plan was conducted from the 26th October to 9th November 2019.

Kolwezi – Solwezi Interconnector Project

The following is the project update: ▪ The Draft Final Feasibility Report was

submitted on 25 October 2019 and was discussed at the Project Meeting held on 6th November 2019.

▪ The project changed substation end-points from Kolwezi-Solwezi to Panda-Likasi substations.

▪ ZESCO will require Phase Shifting Transformers (PSTs) because there is an existing interconnector and the power flow will be difficult to control between the existing and new transmission lines.

▪ The next phase of the project will focus on the preparation of the Final Design Report and Tender Documents.

The main activities for the Environmental Consultant are as follows: ▪ Revising the Screening and Scoping

Report ▪ Mobilization of the team to undertake the

field works planned for between October and December 2019.

▪ Development and refinement of data collection tools to align with the terms of references and planned fieldwork.

Luapula Hydro Electric Power Scheme

The Final Draft of the Pre-feasibility Study Report was submitted by the Consultant to the Project Stakeholders in both English and French on the 29th of October 2019. The report was discussed at a workshop held on 8th November 2019.

The Final Pre-feasibility Report will be

submitted during the second week of

December 2019 and this will complete Phase

1 activities.

Environmental Progress Status

▪ Institutional Capacity Assessment meetings were held in Lusaka and Kinshasa in October 2019.

▪ Development of the Environmental and Social Screening Report is ongoing.

▪ The Workshop to discuss the Draft Final Pre-Feasibility Report was held on 7th November 2019.

▪ The ecological flows and fish passage facilities were considered important and discussed considerably at the workshop.

▪ Draft TORs for the ESIA have been shared for comments from the utilities and SAPP.

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Regional Transmission Infrastructure Financing Facility

A Draft Diagnostics Report and Issues Note were released during the month.

A Project Workshop was held on 28 November 2019 to appraise SAPP and the World Bank on the progress and next steps on the study.

Environmental Corner

Clean Energy Fund for SAPP

The management of the Transformative Carbon Asset Facility (TCAF) fund, has not yet taken a decision, to date, to consider Clean Energy Fund for SAPP (CEF4SAPP) PrePIN proposal. This is following submission of the revised version in August 2019. The German Ministry of Environment has however, signaled its support for including CEF4SAPP in the TCAF pipeline. The SAPP CC held a meeting with the consultant, GFA, on 24 November 2019 and agreed on the next steps and on drafting a concept for converting the current CEF4SAPP carbon based feed-in premium (FIP) into a concept that may be submitted to the Green Climate Fund (GCF), complemented by an estimate of the levelized cost of electricity (LCoE). The GCF approach, will however, run in parallel with the TCAF mechanism.

SADC PCB Elimination Project

The proposal for preparation of a training manual to conduct PCB awareness in utilities was drafted and submitted to Africa Institute for consideration. The salient issues in the proposal aim to address the following:

▪ Standardised procedure for the decommissioning of PCB contaminated equipment; and

▪ Conducting stakeholder analysis and vulnerability assessment.

The proposal should further take cognisance of what is existing in the utilities; facilitate inclusion of PCB management induction in utility induction programmes to ensure its sustainability beyond the project; development of training materials that could be customised to meet local conditions. The utilities are expected to draw from the country budgetary allocation, to conduct the awareness activities as prescribed by the manual.

World Bank ESMF Training

The SAPP Environmental Sub-committee participated in training workshop on the new World Bank Environmental and Social Framework (ESF) in Magaliesburg – African Pride Mount Grace Hotel, Gauteng Province, South Africa from November 18th to 20th, 2019. The objective of the workshop was to strengthen knowledge about the World Bank’s new ESF and its application in investment projects. This ESF Borrower Training Workshop was funded by the World Bank and the training activities were provided to ensure that the SAPP projects preparation and implementation aligns with the ESF principles and requirements.

The Training emphasized many opportunities such as flexibility, adaptative management and the introduction of use of a common approach among Development Partners, but also new challenges with the introduction of new standards and Good Practice Notes. It also stressed the introduction of risk identification in addition to identification of impacts as part of the overall environmental and social assessment. Additionally, new in the ESF is the introduction of an Environmental and Social Commitment Plan, which the borrower shall commit to in

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promoting sustainability in the project development.

Of key consideration, going forward, was the building of institutional capacity to ensure that sustainable environmental and social risk management systems are established within the various utilities and not developed as project specific/tied structures.

Furthermore, the need for undertaking a Strategic Environmental and Social Assessment (SESA) study was stressed, as a key element; a strategic tool to identity environmental and social risks and impacts associated with the regional expansion of the energy network. It will further inform the technical designs and strategic engagement plan for promoting regional integration in the Southern African Power Sector.

Upcoming Events

DATE EVENT

1 – 7 December

2019

Finance Working Group Study Tour to

Europe, Belgium and Norway

4 December

2019

Coordination Centre Board Meeting,

Gaborone, Botswana

5 December

2019

SAPP Executive Committee and SAPP

CC Annual Meeting, Botswana

3-6 December

2019

Power Transfer Limits Update

workshop: ZESA/ZESCO Control Area.

Harare, Zimbabwe

9 -10 December

2019

SAPP Balancing Market Workshop,

Johannesburg, South Africa

10-13 December

2019

Power Transfer Limits Update

workshop: Eskom Control Area.

Johannesburg, South Africa

10 – 14 January

2020

IRENA Assembly, Abu Dhabi, UAE

13 – 17 January

2020

Capacity Building and Training on

Transmission Tariff Calculation Tool,

Harare, Zimbabwe

19 – 24 January

2020

RERA Annual Conference and Other

Meetings, Dar es Salaam, Tanzania

22 – 23 January

2020

Finance Working Group Meeting,

Maseru, Lesotho

Feb/March 2020 54th SAPP Management Committee

Meetings, Lilongwe, Malawi

March 2020 48th SAPP Executive Committee

Meetings, TBA