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Cape Town proposes rewards system for customers who reduce their electricity use on demand
To protect its customers from some of the impacts of load-shedding, the City of Cape Town has issued a tender that will see customers rewarded for reducing their power use at a given time so that city-supplied customers can be protected from the impacts of load-shedding.
These Cape Town “power heroes” will be key in the city’s load-shedding protection efforts going forward, where a reduction in energy use of 60 MW is targeted.
Third-party aggregators appointed through the tender, will sign up these “power heroes” on a voluntary basis, comprising residential and small-scale commercial customers.
When energy use needs to be cut, the aggregators will switch off agreed-to nonessential electrical equipment of the “power heroes” remotely through installed smart devices.
Aggregators will then reward the “power heroes”. These aggregators will determine the incentives and manage it.
The city will, in turn, reward the aggregators in terms of the tender conditions and agreements.
Interested parties will have until November 1 to submit their tender bids. More information can be found on the city’s tender portal.
“At the heart of this new intervention is the conviction that small actions can lead to big impacts. These power heroes will help the city to protect customers from the higher stages of Eskom’s load-shedding in particular.
“The Eskom situation is so precarious that a combination of interventions will be key over the next decade as work continues to reduce our reliance on Eskom,” Cape Town mayor Geordin Hill-Lewis says.
He believes smaller energy consumers can make a big difference in keeping the lights on for longer in Cape Town and to ensure that the Cape Town economy is protected as much as possible.
“As Eskom has shown that load-shedding is here for the foreseeable future, we need to do whatever we can in Cape Town to keep our city moving forward,” Hill-Lewis says.
The new initiative forms part of Cape Town’s demand response plan to mitigate load-shedding while the city works on getting new energy sources on board to end load-shedding over time.
Cape Town already successfully deploys the Steenbras Hydro Pumped Storage Scheme to protect its customers from up to two stages of load-shedding, where possible.
For example, between February and July, Cape Town protected its customers from 722 hours of Eskom load-shedding.
“In Cape Town, we have decided that we cannot sit around and wait for Eskom and the national government to do what needs to be done to end the load-shedding that is destroying our economy.
“I have written to the President explaining ten ways that the problem could be fixed with the help of municipalities such as Cape Town, but have not been met with any willingness in this regard.
“Whether or not national government takes any meaningful action, Cape Town will continue to press ahead with a variety of innovative and aggressive actions to achieve energy security for our residents,” Hill-Lewis says.
With this tender, reducing demand will become a contractual requirement and bring more certainty to the city’s energy space. Once the third-party entities or aggregators that will manage the power heroes have been appointed in terms of the tender processes, the aggregators will be made known to the public.
“This is an exciting new initiative based on teamwork and collaboration. In addition, we are busy evaluating a tender we advertised earlier this year, which will enable the city to procure 200 MW from independent power producers (IPPs).
“We’ve also just issued a tender for the engineering, procurement and construction of a solar power plant in Atlantis, with more planned across the metro,” Hill-Lewis states.
Apart from IPP and own-build projects, Hill-Lewis says the city is working to create an enabling environment to bring more partners on board.
“If one looks at small-scale embedded generation for instance, the city has allocated R15-million in this financial year to pay for energy generated by small-scale embedded generators through the feed-in tariff of 75.51c/kWh and the 25c/kWh incentive offered for small-scale embedded generators.
“The programme to end load-shedding over time and to reduce the impact of load-shedding is multi-faceted and much work is under way. We look forward to creating a new energy regime in Cape Town, built on partnerships, innovation and cleaner, more affordable technology,” City of Cape Town Energy MMC Councillor Beverley van Reenen says.
The demand response programme forms part of a suite of interventions being put in place by Cape Town to reduce reliance on Eskom’s failing generation capacity.
Among these is the ongoing procurement of power from IPPs, which is currently in the technical bid evaluation phase. The construction of the city’s own solar plant in Atlantis is also on the cards, scheduled to begin next year, with more own-build projects planned across the city.
The introduction of cash payments for excess electricity produced by commercial customers with their own embedded generation facilities, for example solar panels on factory roofs, has also been a welcomed intervention.
Moreover, Cape Town’s wheeling project will allow large generators to sell to private consumers at other locations in the city through the use of the city’s distribution grid and reduce the demand for Eskom-produced power.
