Jeffreys Bay Wind Farm Jeffreys Bay wind farm – how an industry began The 138 MW Jeffreys Bay Wind Farm, one of the first large wind energy projects that will be commissioned in South Africa, stems back to 2001 and a small sustainability related start-up company. I n 2001 two individuals, Louis De Lange and Andries Van der Linde, had a company called Sudor Eco- Ventures, which looked at sustainability in focus areas such as forestry, value- added agricultural products and water supply. Van der Linde was based at the Port Elizabeth Technikon, having studied overseas and having worked for a Danish utility. The technikon had a small wind turbine on its roof and with his background in Denmark, Van der Linde started to study wind in the Eastern Cape. He and De Lange were in close contact with Eskom in the region and became aware that a lot of dairy farms and brick factories in the Hankey, Patensie, Humansdorp, Jeffreys Bay area suffered from power quality issues, sitting as they were at the end of a thin grid system far from generation sources. Eskom suggested that if a power project was undertaken in that area it would be a good idea. The decision was made to form Genesis Eco-Energy, which did a study that concluded a combination of wind energy and pumped storage would work well. A local dairy farmer, Mark Holliday, was open to the idea as the area needed the power – dairy farmers were losing a lot of fresh milk when the power went down. The plan was for a 10 MW wind project to be sited on Holliday’s farm located between Humansdorp and Jeffreys Bay and a 5.0 MW pumped storage scheme to be located on the Gamtoos River. The group brought in Davin Chown, now director of Genesis 96 Eco-Energy, from the investment and finance sector, to see if he could source finance for the venture. In 2003/2004 a steering committee for the project formed. It included members of Eskom, Eddy Leech and Chris Billingham, the local municipality, the World Bank which was seeing the carbon issue raise its head and wanted to seed development, and the Development Bank of Southern Africa (DBSA) which put up some money for an Environmental Impact Study (EIA) undertaken by the CSIR. “At the time it was mostly the Genesis Eco-Energy shareholders that invested their money into the project and forged ahead with it,” Chown says. The plan was to put the electricity from such a project into the municipal grid. One of the first municipal power purchase agreements (PPAs) was drawn up, the intention being to sign with the Jeffreys Bay municipality. However, undertaking a project was easier said than done. With the nature of the regulatory framework in place, it was difficult to get acquiescence from the National Energy Regulator of South Africa (Nersa), and the project could not progress to financial close. Unlike the Darling Wind Farm project that was developed by Herman Oelsner, the Jeffreys Bay Wind Farm team wanted to keep its project commercial and private as opposed to turning it into a government backed demonstration initiative. While the 5.2 MW Darling project was built earlier, in the long run the latter proved to be the more successful route. Chown says that the Jeffreys Bay project was going to use refurbished turbines which came in at good prices, because of repowering in Europe. “These turbines had been up for only eight to 10 years and would have been fine to test the market within South Africa. We wanted to get the wind farm up and do baseline studies. We were also looking at other sites, on the west coast of South Africa, in the Northern Cape, and seven or eight different places in the Eastern Cape. “For the next five years, from 2004 to 2009, the project moved along slowly. The regulatory regime was the big blockage. Doors did not open. A group called Amatola Green Power had private clients that wanted power, but it was not willing to pay wind farm prices. During that period several parties were keen on undertaking the project. Dutch, Greek, and a reputable British company that is currently active in South Africa, all looked at it and were excited but could not see it working because of regulatory blockages. Nersa said yes but municipalities could not by law, as remains the case, because the power received would be more expensive than what they get from Eskom. There was also the issue of how to absorb the cost of the power on a three year timeframe according to which municipal procurement operates. Between 2002 and 2008, the undocumented gentleman’s agreement between Genesis Eco-Energy and Mark Holliday kept the dream of the wind farm project alive. “All the landowner asked was our promise that we would do all we could to make it work. Holliday said he ESI AFRICA ISSUE 1 2014