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| You are here: | Comments and remarks to Wim Jonker Klunne |
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| The Friedenheim hydro plant on the Olifants River in Nelspruit (South Africa) is an example of a hydro plant that feeds into the national electricity grid. Friedenheim hydro can be viewed as the only existing Independent Power Producer (IPP) in South Africa. It is privately owned, sells the bulk of the generated electricity through a Power Purchase Agreement (PPA) and is a profitable operation. The plant is operated as a commercially profitable and sustainable business venture. It is owned by the members of Friedenheim Irrigation Board and operated by MBB an engineering firm. The plant provides power for water pumping to FIB, but 93% of the power generated is sold to the Nelspruit local authority through a PPA that sets the tariff at 12% below the price at which Nelspruit buys power from ESKOM (its bulk electricity provider). | ||
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The Friedenheim Hydro scheme has proved a profitable and viable investment. Its successful track record has gone along way towards dispelling the myths common in the electricity supply industry that it is not possible to compete with ESKOM, especially not with small and renewable energy producers selling energy wholesale. The motivation for the PPA with the Nelspruit Local Authority was based on the cost savings involved in buying electricity at a rate below that of ESKOM and to a lesser extent the increased security of supply offered through this diversification in suppliers |
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more information on hydropower in South Africa
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