Power from waste

2016-02-26 09:44
The Msunduzi municipality has signed a 15-year deal with a UK-based energy firm.

The Msunduzi municipality has signed a 15-year deal with a UK-based energy firm. (File)

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Pietermaritzburg - Msunduzi Municipality has entered into a 15-year contract with a UK-based energy firm that will see the New England Landfill site generate electricity.

The gas-to-energy project involves the extraction of methane gas from the landfill site, which will be converted into energy and fed into the Eskom grid.

According to a report presented to the city’s full council this week, ENER-G Systems has secured the rights to develop the project at “no cost and no risk” to the municipality.

In return, the company would share revenues from the project with the municipality on a percentage basis.

ENER-G finances, designs and delivers a range of low-carbon, energy-efficient technologies. The company has offices in the Netherlands, Norway, Italy, Spain, Romania, Poland, Hungary, South Africa, Mexico and the U.S.

The Msunduzi project is expected to cost R6 million to develop gas wells, piping, gas-to-energy conversion engines and infrastructure at the landfill site.

The company has submitted a proposal suggesting that it sells the electricity generated to the municipality at 97 cents per kilowatt. The municipality will not receive any royalties in the first three years so that ENER-G Systems can recover some of the initial capital and operating costs of the project.

“This [royalties] will then increase by five percent a year up to a maximum of 20%,” read the report.

The municipal electricity department confirmed that it would sell the electricity to customers at 100-145 cents per kilowatt.

“The additional capacity can be viewed as the city’s contribution to load shedding … and could be taken into account in further load-shedding schedules,” continued the report.

Pietermaritzburg Chamber of Business CEO Melanie Veness said with the world’s availability of natural gas, the project “makes sense”.

“We face huge challenges with regard to gas and the project does make sense,” she said.

The project will initially generate one megawatt of electricity, increasing to 1,5 megawatts as the project develops. One megawatt of electricity can support up to 600 middle income households and 1 200 low-cost homes. The municipality will take responsibility for managing the emission of harmful greenhouse gases.

“This project will ensure that the methane gas emissions from the landfill site are harnessed and converted into a renewable source of energy.

“The municipality will be at the forefront as one of the few in the country to contribute towards the reduction in the emission of greenhouse gases into the environment,” read the report.

The city’s municipal manager was authorised to sign the power purchase agreement and amended gas rights agreement.

It is unclear what the timeline for the project will be.

• kailene.pillay@witness.co.za

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