Archive | December 2012

Interview: Inside Ghana’s first major PV power plant

Blue Energy announced the 155 MW Nzema photovoltaic power plant project today. The U.K.-based renewable energy developer has formed subsidiary Mere Power Nzema Ltd. to execute the project. Douglas Coleman, is the project director of Mere Power Nzema and he took the time to speak with pv magazine about the project particulars.

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The 155 MW Nzema installation will be completed in 10 MW zones and is set to be completed by the end of 2015.

Tell me about the first steps towards this project?

The Ghanaian government passed a law at the end of 2011 with a view to having an aspiration to have 10% of their generation coming from renewables by 2020. In the anticipation of that law, we started development of that project in 2010, to put together all the project rights that we would need to acquire land, get environmental permits, get a generating license, geological license and a whole raft of other things.

They’ve now been put in place and now we have the FIT law. The renewable energy law provided for the off take from qualifying renewable energy assets to be made under a FIT arrangement. That FIT is specific to a specific installation and project.

Once you have your project developed, you create a financial model and the independent regulator in Ghana, the Public Utilities Regulatory Commission (PURC), rigorously interrogates that. The PURC set the tariffs, not just for renewables but also for any generating source. After a year of discussion and review, a FIT stage one was awarded to the project in late October.

Take me through the particulars of the project.

The project is a peak capacity 155 MW. It has an annual export generation expected to be in the order of 240,000 MWh p.a. It involves 630,000 245W crystalline panels.

Where will the modules be sourced?

There are a number of suppliers being considered at the moment. The project has not committed to a single source of supply yet. We’re looking at having a competitive process underway in the next few months.

Will you use one supplier or will you use a number of technologies, to spread the risk?

The project is currently expecting to use a single supplier.

For a utility scale plant this size grid connection becomes a major issue. How is that challenge going to be met?

We are connecting directly into the West African interconnector, so we’re connecting in transmission voltage (161 kV). There is capacity in the transmission network in Western Ghana with some reinforcement to accept load at the point at where we’re constructing the plant.

The location was chosen for three reasons. One is stable irradiation levels, which are very good in the region generally. The stability of the network which is adjacent to the project, 30 meters away, with sufficient capacity available in the network to allow us to inject the load. And finally close proximity to the deep water port of Takoradi, in the west of Ghana, given that the majority of components will be imported, because there is very little domestic manufacture or the components that we’ll need.

What will the one-off FIT be paying for the project?

At the moment it is commercially confidential between the regulator and the government and the project, but it well be gazette and published locally. This is where Ghana has shown itself, in my eyes, to be particularly astute. Instead of publishing a single tariff, they realize that the capital cost of renewables, particularly solar, is not fixed, it moves with time as costs become lower. So the government arranged itself in such a way that it will award a tariff based on a plant based on its CAPEX, OPEX and other factors.

Does the project have a 20-year PPA?

The project will have the benefit of a PPA from the distribution company local to the project but the independent regulator fixes the price for the export.

Looking then at finance, how will that be secured?

The project will be putting in place security mechanisms, such that investors have comfort that the PPA will be safe and secure.

Is the development bank financing as a part of the mix?

We’re talking to a number of development banks, as well as infrastructure funds. There will be quite a basket of funders for this project.

What is the mix between equity and debt?

We will be looking to have around 30% equity and 70% debt and of course the debt will be syndicated.

What would your advice be to other firms who may be interested in developing projects in Africa?

Particularly in West Africa and South West Africa essentially photovoltaics works very well, which means we can provide an energy source that has a highly predictable output. That’s really important for governments to be able to plan for the reliability of the solar photovoltaics. This is particularly true with grids and distribution networks that are developing and emerging; we need to be able to provide a solar resource that delivers the least stress to those assets as possible. Solar photovoltaics match that requirement perfectly.

The Nzema project is planned to be completed by the end of 2015. It will be installed in 10 MW zones on the one site. Financial closure planned for mid 2013. For more information, pick up the January edition of pv magazine.

Read more: http://www.pv-magazine.com/news/details/beitrag/interview–inside-ghanas-first-major-pv-power-plant_100009468/#ixzz2GWT0viB0

 

 

The Nzema project Ghana solar energy plant set to be Africa’s largest

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A UK firm has announced plans to build what it claims is the biggest photovoltaic (PV) solar power plant in Africa.

The Nzema project, based in Ghana, will be able to provide electricity to more than 100,000 homes.

Construction work on the $400m (£248m) plant is due to start within 12 months.

The developers say that they are optimistic that finance for the project will be confirmed within six months.

Fully cooked

The initiative is being developed by Blue Energy, a UK-based renewable energy investment company.

It is the right plant in the right place at the right time”  Douglas Coleman Mere Power Nzema Ltd.

Dozens of solar projects have been announced across Africa in recent years but few have been on this ambitious scale says industry analyst Ash Sharma at IMS Research. He says the 155 megawatt plant will increase Ghana’s generating capacity by 6%.

“It is the biggest single project that’s going ahead at the moment,” he told BBC News. “It is not the biggest in the world, but if it goes ahead it will be the biggest in Africa.”

He says that a key element in helping the project go ahead has been Ghana’s renewable energy law under which the plant has been awarded a feed-in tariff for 20 years. These are premium prices, guaranteed for the working life of the site.

Project director Douglas Coleman, from Mere Power Nzema Ltd. who will build the plant, told BBC News that it was “fully cooked” in planning terms.

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This map shows the amount of ultraviolet radiation reaching the ground

“The project has land, it has planning consent, it has a generating licence, and it has received a feed-in tariff,” he said, “it is the right plant in the right place at the right time.”

He was confident that the finance needed to build the plant could be raised in the next six months.

The company behind the scheme is majority owned and funded by members of the Stadium Group, a large European private asset and development company with £2.5bn under management.

Ash Sharma believes that the backing of this firm plus the feed-in tariff makes the idea viable.

“One of the biggest stumbling blocks has been overcome and the financing looks like it could be in a good position to succeed I would say.”

Not concentrating

Unlike many other solar projects in Africa that use concentrated solar power, the Nzema plant will use photovoltaic (PV) technology to convert sunlight directly into electricity. Douglas Coleman says the characteristics of the Sun in Ghana favour PV.

“We can predict with great certainty on an annual basis, the output from the plant. That predictability means we can harmonise with the needs of the transmission network, to balance load with generation.”

While concerns have been raised in recent weeks about the future of North Africa’sDesertec project that aims to export solar power to Europe, researchers are far more hopeful about the prospects for local African markets.

Demand for renewable energy has been held back in emerging economies like Ghana by high costs, but a recent glut of solar panels on world markets has seen prices tumble – much to the advantage of African countries.

“The reason the technology hasn’t taken off so far is that it has been too expensive,” says Ash Sharma, “but the costs of solar have decreased dramatically in the last two years, they’ve fallen by 40% plus, and this has really enabled it to be used in emerging regions in Africa and Asia.”

Installation of more than 630,000 solar PV modules will begin by the end of next year with electricity being generated early in 2014. It is due to reach full capacity at the end of 2015.bbc