Abstract
M.Phil. (Engineering Management)
South Africa is currently experiencing load constraints during peak, standard and off- peak hours, with Electricity Utility, Eskom, having to implement load-shedding frequently, in order to prevent a total blackout of the electrical grid. These load constraints are continuing to affect the country’s ability to sustain electricity supply. The investment model presented in this study completely analyses the investment scenario, which demonstrates the Battery-Energy-Storage Systems (BESS) economic benefits. The primary focus is to analyse the grid-load profile by assessing three applications: peak-load shaving, load-levelling and maintenance-deferral in different market segments. The total BESS required capacity is attained by combining the required capacity from three BESS applications, which is used to develop an investment case. The secondary focus is to develop an investment case, and to analyse the economic benefits by evaluating the following five variables: Cash flow, Net Present Value (NPV), Return on Investment (ROI), Internal Rate of Return (IRR) and Payback period. The final expected output results of the study is the investment model used to demonstrate the BESS-economic benefits. The current research project is conducted by exploring three BESS applications, which may be formulated in contributing to solve South African energy problems. Three BESS applications analysed with the data attained from the national grid-load profile to assess the grid behaviour and the need to introduce each application when it is necessary. The load requirements from the analytical results is then translated into BESS economic benefits using Discounted Cash Flow (DCF) model. The current study attained viable results, which shows that BESS applications do offer solution to elevate the constraint from the grid-load profile, and the investment yields tolerable economic benefits. The current study can conclude that investing in BESS is viable, provided that the tarriff increase is within the inflation target and the NERSA regulations do not constrain the BESS revenue by setting up an non-viable tarriff.