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Africa’s Rise In Power: Power generation needs growing in Africa
by amanda m. klemp

Rich in resources, culture and growth, Africa’s power needs are growing and power generation system orders have been increasing to catch up with growing industrialization
and population. The proof is in the numbers. According to the 2010 Power Generation
Order Survey from Diesel & Gas Turbine Worldwide, 2009 orders across the African continent totaled 1584 units including diesel, dual-fuel and gas engines, and gas turbines. No steam turbine orders were reported. That’s up from the 2009 Order Survey, which totals orders from June 2008 to May 2009. That 12-month period generated 1256 units ordered, comprising diesel, dual-fuel and gas engines, gas turbines and 16 steam turbines. Even during a time of global recession, orders increased from the African continent. According to Tony van Velzen, Wärtsilä’s regional director for Africa, about 10% of people on the continent are connected to the grid and about 80% of that capacity is installed on the northern and southern coasts.

Currently, explained van Velzen, most power consumption is going to large industries and major cities, while rural electrification is still secondary because it needs to be heavily subsidized due to high costs of production and scarcity of available fuel. “Non-availability of funding is the biggest issue. Some countries are completely depending on selfgenerating industries and households. Small household generator sets are used as consumables. Costs of this generation can go as high as US$0.40 to US$0.50 per kilowatt hour. Most financing comes from abroad for infrastructural projects,” said van Velzen.

He said that growth of power generation will follow the pace of economic growth and available funds to invest in power. He estimates economic growth to be between 5 and 10% per year, and this is due in large part to a vast supply of natural resources. While current expansion of generating capacity may be slow compared to what may be needed, van Velzen said that demand and economic growth will accelerate power expansion rapidly and even predicts a doubling in capacity in coming years.

Markus Kidele, senior sales director Africa at MAN Diesel & Turbo, said there is a lot of suppressed demand in Africa, particularly countries with natural resources and  manufacturing, because local utilities can’t keep up with the growing power needs. “It’s a permanent growth in utility power, because a lot of the African countries are picking up pretty fast due to high growth rates. Some of them go into 10, 20 or 30% of growth every year right now,” said Kidele. He explained, “It is because the countries are developing so fast not all of them, it is perhaps 10 to 15% of the countries. But it’s countries like Morocco, like Egypt, like Angola, Nigeria, Ghana  all the countries that have oil.

“These countries are developing so fast right now that they develop infrastructure. They get a lot of money coming out of Asia — a lot of Chinese investment, a lot of Indian investment,” said Kidele, explaining that this investment into these countries has promoted the demand for more energy and “the demand is substantially growing.”

“On average, Africa contributes over 20% of the business for Wärtsilä’s Power Plant division. This is due to Wärtsilä’s focus on the continents and its efforts to assist or contribute to financing,” said van Velzen. “The fuel-flexibility technologies Wärtsilä supplies enable utilities and industries to be more flexible on sourcing scarce fuels, and due to transport logistics, expensive fuels on the continent. Furthermore, our technology allows them flexible operation without fuel consumption degradation, whether gas or liquids.”

Recent orders for Wärtsilä in Africa have included a 120 MW power plant in Kenya funded by a locally raised foreign currency loan and a gas engine power plant ordered by independent power producer Kribi Power Development Co., an affiliate of AES Corp., for installation on the Gulf of Guinea coast in the Republic of Cameroon. The Kribi power plant will supply the local utility, help to diversify Cameroon’s hydro-powered grid and aid in meeting the increasing power demands of the country.  Kidele said Africa is one of MAN’s most important markets right now, due in large part to the steadily growing demand.

While MAN currently has offices in Kenya and around the coastlines, “Our intention is to step up our presence big time,” said Kidele. One recent significant installation for MAN was in Morocco, an 80 MW plant for the utility. Kidele said about 50% of the projects ordered from MAN for Africa are for state or utility projects, and they typically run anywhere from 5 to 100 MW. He also said most installations are for heavy fuel, with gas or dual fuel being the second in demand.

In addition to the Moroccan installation, in the last year MAN received an order for four 18V51/60DF gensets by Israeli company Telemenia for the installation in Gabon. The dualfuel gen-sets are rated 1000 kW for 60 Hz operations and 957 for 50 Hz operations, and the power will be used to supply Gabon’s capital. Another installation in Egypt comprised three 18V2832S diesel engine gen-sets, each rated 4230 kW. The gen-sets were installed in southern Egypt as part of an irrigation project to pump fresh water to nearby farmland with the aim of creating over half a million acres of viable farmland.

Siemens, as well, has noticed the growth opportunities in Africa, announcing last summer that it would be investing US$272 million over the next two years to expand business and sales structures across the continent, with a focus on renewable energy, such as wind and solar. Siemens said it will enter the market by introducing medium-priced products that have been specially developed for emerging countries. The company expects demand particularly in urban centers, predicting growth from today’s 400 million people in urban areas to 750 million by 2030.

In September, Siemens received an order from Nigerian utility Niger Delta Power Holding Co. for a gas-fired power plant, scheduled to begin operation in late 2012. The three SGT5-2000E gas turbines will supply 434 MW for the utility grid.

Source: WWW.DIESELGASTURBINE.COM

Categories: News, Power generation

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