Silas Zimu, one of the key players in South Africa’s fast-expanding renewable energy sector, says the seminal climate change documentary by Al Gore, An Inconvenient Truth, was the trigger for his new focus, the development of green energy in Africa.
Zimu, 46, took up the position of chief executive officer of the South African unit of Indian wind power company, Suzlon Energy in 2010, after years working for power utilities that relied almost entirely on coal.
“It changed my outlook so much I started searching for green solutions,” he says.
After running City Power Johannesburg, a parastatal electricity distribution company, for three years, Zimu came to Suzlon with 19 years’ of experience in South Africa’s power industry, including senior roles at the country’s power monopoly, Eskom.
He has now played a part in securing two of the government’s wind power contracts, which will involve billions of rands of investments.
Under his stewardship, the group, one of the world’s leading wind turbine makers, has already started building 66 wind turbines near Cookhouse in South Africa’s Eastern Cape province. When the units are completed by 2016 it intends to sell power through Eskom’s national grid by 2016. It is the biggest renewable tender awarded in the first round of government tenders.
Suzlon will operate and maintain the turbines energy project selected during round one of the government’s Department of Energy’s Renewable Energy Independent Power Producers Procurement Programme (REIPPP). The awarding of tenders through the program has been a long time coming, with the policy amended at least once, leaving potential investors somewhat confused for a time.
The Cookhouse Wind Farm is being developed in partnership with African Clean Energy Developments (ACED), described as a South African-based renewable energy project developer, owned jointly by Old Mutual-owned African Infrastructure Investment Managers AFPOC Limited.
Fulfilling government’s desire that South Africa, in terms of job creation and the local communities, benefits from the renewable tenders, the Cookhouse Wind Farm Community Trust holds 25% equity in the project. It is anticipated that the local communities of Cookhouse, Bedford and Somerset East will be beneficiaries of the trust.
“The strategy is to make Suzlon a company that embraces empowerment in South Africa, to manufacture in the country and have offices here. We have a locally-appointed team. We know the playing field and know what we should be aiming for, while understanding government’s renewable framework. The last few years have been tough, but this is the risk one had to take,” says Zimu.
This partnership was part of the awarding of the first government tender. Under the REIPPP, government has said it wants 1,850 megwatts (MW) to be provided by a variety of renewable power sources annualy; this includes wind, solar and power generated from biomass. It hopes to have this much on line by 2021, adding to the country’s current installed capacity of about 40,000 MW.
When Suzlon SA won its first tender, Zimu says friends and family threw a surprise party for him, but he says,
“I would like to celebrate when the first megawatt is generated”.
Zimu, who has a Master’s in engineering, has a 20% stake in Suzlon’s South African unit. It is part of Suzlon Energy, which is the world’s fifth biggest vertically integrated wind turbine maker. He sits on the executive committee of the global group, which is based in Pune, India.
The first project will import the turbines and steel towers to assemble the windmills but Suzlon energy SA is planning to form an operations and maintenance company that will be South African-based.
The intention is to build the steel towers in South Africa for a second project. Zimu says the group has already been awarded a second contract. It will be announced in the next few months.
“We are working towards financial close on that.”
South Africa plans three rounds of bidding for renewable energy projects in the second round Suzlon again secured the biggest allocation in terms of power it will produce. The two projects combined, when up and running, will make Suzlon the second biggest wind turbine company in the country.
South Africa’s desire to build up its green energy sector to reduce its reliance on coal, head off potential power shortages, and meet ambitious targets for slashing greenhouse gas emissions is attracting assistance from other countries. Zimu expects companies like Suzlon to benefit.
In March, Denmark said it would work with the South African government towards its meeting of its renewable goals. The Danish government said in a statement that before the transition from coal to wind energy can take place, wind resources must be mapped and the power grid regulated to allow wind energy to be exploited to the fullest possible extent.
“If we can assist a country like South Africa to convert to more renewable, energy efficient power sources, the climate as a whole will benefit. In 2009, South Africa’s carbon dioxide emissions constituted half of Africa’s total emissions,” says Martin Lidegaard, the Danish minister for climate, energy and building.
Currently South Africa boasts some of the world’s biggest coal-fired power plants and generates some energy from nuclear, natural gas and hydropower sources. While crippling power outages in 2008 forced Eskom to press ahead with two major coal projects, the country’s aim is to spread its power generation across a number of technologies to take advantage of the nation’s abundant wind and solar power potential. Ambitious solar, wave power, hydro and biomass initiatives are also being considered.
Zimu says that Eskom has the capacity to make all the grid connections and the Danish government may help government develop a policy on grid codes.
Zimu is leading Suzlon’s charge into other African countries.
“We have been awarded work in Mauritius and are interested in tenders in Kenya and Namibia,” he says.
It also presented submissions for work in Madagascar and has been invited to visit interested parties in Nigeria, Angola and Ghana.
“I think South Africa is showing other African states the way,” says Zimu.
Even so, other African countries such as Morocco and Kenya are developing ambitious projects of their own. In Kenya the $800 million Lake Turkana Wind Power project is billed as the continent’s biggest and is expected to generate 300MW of electricity.
However, GDF Suez of French and Moroccan company Nareva Holding plan to build a plant of the same size in the desert region of the North African country. Morocco is planning to have 2,000MW of installed wind power by 2020. Lesotho, the mountainous country landlocked by in South Africa, has its own ambitious.
On whether the costs of wind power compare favorably to those of other renewables, Zimu pointed out that solar is more expensive and says wind energy can compete with projects powered by biofuels.
“My vision is to go green, generate green energy [and] create green jobs”.