[Date Prev][Date Next][Thread Prev][Thread Next][Date Index][Thread Index]

dam-l Epupa "Cheapest option"/LS

>From The Namibian today:

Epupa power 'cheapest option'

 WERNER MENGES

 A NEW hydropower scheme on the lower Kunene River is, in spite of its
environmental costs, the cheapest way to increase Namibia's electricity
generating capacity, says the final report of the feasibility study on the
controversial project.

 Building a hydroelectricity plant at one of the two currently considered
sites of Epupa or at the Baynes mountains on the lower Kunene River would
cost less than the next cheapest options to increase the capacity of
providing electricity to Namibia - importing power from South Africa or
building a new power plant that would be driven with fuel from the Kudu gas
field.

 Alternative renewable and environmentally friendly energy generation
options such as wind and solar power are more expensive than the Kunene
hydroelectric or Kudu gas options, and are not expected to become
financially viable within the next 10 to 15 years, the report states.

 PERHAPS LATER
 The report, compiled by a consortium of Namibian, Swedish, Norwegian and
Angolan consultants that carried out the feasibility study under the name
of Namang, states that it is "pessimistic about the near to medium term
future for large scale renewables in Namibia". Reasons for this, it
explains, are because the conventional energy resources available to
Namibia are cheap by world standards and likely to remain so over at least
the next 15 to 20 years, whereas the large scale promotion of renewable
energy sources would use economic resources which could otherwise be used
for other investments.

 In the longer term future, though, especially if oil prices increase in a
major way, it is likely that solar and wind power would become more
attractive. Therefore, the report advises, it is important that the
Namibian government maintains a foothold in these renewable energy
technologies - by ensuring there is a build-up of relevant data, especially
of wind trends, and by limited investments in well-designed pilot projects,
with as much donor funding as possible.

 It could also be to the benefit of the governments of Namibia and Angola,
who will have to decide whether to go ahead with the proposed project or
not, to opt for environmentally better power supply alternatives, the
report states. By doing so, they may gain recognition and credibility among
environmentally concerned organisations and groups, which "may conceivably
carry weight and make concessional finance towards the energy sector or
environmental actions more accessible."

 Says the report: "This is a matter warranting careful consideration by the
two governments."

 COMPARING CENTS
 Namang calculated that the current cost of electricity imported by Namibia
from South Africa is about 1,8 US cents per kilowatt hour. In contrast, the
cheapest renewable alternative - electricity generated with the currently
available wind power technology - would cost some 7 US cents per kilowatt
hour. Generating electricity with solar thermal technology - where rows of
mirrors focus the sun's heat on a central pipe which heats up to produce
steam for electricity generation - would cost some 13,3 US cents per
kilowatt hour at this stage, while power generated by photovoltaic cells
connected to the central power grid is estimated to cost 38,4 US cents per
kilowatt hour.

 The report estimates that electricity generated at a single hydropower
station - as opposed to the option of building two power stations, one each
on the Angolan and Namibian sides of the Kunene River - at the Baynes dam
site would cost 4,8 US cents per kilowatt hour if the Gove Dam in Angola
which is supposed to regulate the flow of the Kunene is working, and 6,6
cents per kilowatt hour if the Gove Dam is not working.

 Power generated in a single station at the Epupa site would cost 4,5 US
cents per kilowatt hour with a working Gove Dam and 4,6 US cents per
kilowatt hour without the benefit of Gove's effect.
 The cost of electricity to be generated by a gas-fired power station
running on fuel from the Kudu gas field would depend on the size of such a
station, the report indicates - the larger the capacity of a Kudu power
station, the cheaper the power that it will generate.

 If a Kudu power station with a capacity of 360 megawatt - the same as the
report envisages for a lower Kunene River hydropower scheme - is built, it
would produce electricity costing an estimated 5,3 US cents per kilowatt
hour. Once the capacity of a Kudu power plant is increased, the price of
its electricity starts to dip below that expected from either the Baynes of
Epupa hydropower options. A gas-fired power station with a capacity of 750
megawatt would deliver Kudu power at 3,55 US cents per kilowatt hour; at a
capacity of 1 300 megawatt, the cost of Kudu power goes lower still, to
2,85 US cents per kilowatt hour.

 The energy contained in the Kudu gas field "by far outstrips the near
future energy needs of Namibia". The proven recoverable reserves in the
Kudu gas field alone would already be enough to run a 1 000 megawatt
combined cycle gas power plant for 50 years, according to the report..

 By 2010, imported electricity is projected to cost Namibia 3 US cents per
kilowatt hour. The cost of wind power is projected to have decreased to 4,9
US cents per kilowatt hour by then, with the cost of solar thermal power
forecast at 10 US cents per kilowatt hour, and grid connected photovoltaic
power projected at 21,9 US cents per kilowatt hour.

 Clearly, the report indicates, with such cost differences renewable energy
alternatives are not financially viable options at this stage and no major
role in the Namibian generating system should be envisaged for these
technologies over the next twenty years.

 POLITICAL CHOICE
 Many of the environmental and social drawbacks of the proposed hydropower
project - such as the drowning of the Epupa Falls and thousands of
food-producing omurunga palm trees, as well as the destruction of the
habitat of three critically endangered fish species if a dam is built at
the Epupa site 7 km downstream from the Falls, as well as the impact of
such an unwanted scheme would have on the economic survival, social
cohesion and culture of the Himba residents - cannot be calculated in terms
of neat amounts of money. These would however have to be weighed up against
the financial costs and savings of the hydropower options, says the report.

 Given this dilemma, the governments of Namibia and Angola will have to
base their decisions on a choice between development and preservation of a
particular site, the report comments. "The decision between scheme
scenarios and alternative means of supplying electric power is thus in the
realm of politics in Angola and Namibia."

 One of the factors sure to be considered, is the ability of the existing
electricity generation plants in southern Africa to continue to supply the
power needs of not only the countries where they are situated, but also the
countries that import electricity, such as Namibia which depends on South
African power.
 South Africa still has the capacity to generate more electricity than it
needs, but it is expected that by 2005 its growing demand for power will
start to outstrip its excess generation capacity, the report points out.
 Thanks to the new 400 kilovolt interconnector power line being built
between Windhoek and the South African power grid, Namibia will have the
capacity to import enough electricity to cover its projected power demands
for the next one or two decades, says the report. In such a situation,
though, Namibia will be highly dependent and exposed to developments in
South Africa, and would probably have to pay the price of additional
generating capacity in South Africa once demand starts to outstrip capacity
there around 2005.

The final feasibility report estimates that it would take some four and a
half years to build the proposed lower Kunene River hydropower plant, which
in turn would have a lifetime of 50 years, and that Kudu power could start
to be phased into the South African power grid by 2003 at the earliest.
With the South African power demand and supply break-even point around 2005
approaching, this leaves just enough time to decide where Namibia's
electricity would be coming from in the new century.

 The report summarises the choices facing the two governments as follows:
Building a hydropower plant at Epupa with the Gove Dam working would
represent a saving of US$25 million over the life of the project compared
to the alternative of importing electricity, or a saving of US$85 million
to US$90 million compared to the other cheapest alternative of generating
power using Kudu gas.

 A plant at Baynes, also with the Gove Dam working, would be US$8 million
cheaper over the life of the project than importing power, and US$60
million to US$65 million cheaper than Kudu gas generation.
 The report asks: Is it worth spending these amounts more in order to
preserve the environmental features which would be destroyed or severely
affected by the Epupa or Baynes options?

 In other words, is it worth building a hydropower plant which would have
serious effects on its natural environment and which would go against the
expressed will of the people living in its area, for the benefit of having
electricity at a relatively low price?