Future Coal Supplies - more, not less!

There has been a growing trend toward predicting an imminent peak to the production of coal. Just this last week Nature carried an article that précised Richard Heinberg’s recent book on Coal production, which I reviewed when it first came out. And while that was based, in turn, on David Rutledge’s application of Hubbert Linearization to coal production, (discussed here ) that underlying theme had also been picked up in an article in Energy by Tad Patzek. This latter paper had just come out when, at the beginning of last month, I gave a paper at the ASPO-USA meeting explaining why the approach was wrong. I did that with Kjell Aleklett sitting in the front row of the audience; his graduate student Mikael Höök had just presented a dissertation along the same lines.

Why am I so obdurate that this is wrong, in the face of such heavyweight opinion? Well let me run through the bones of my argument to explain why.

The most extreme of the positions on the imminent coal peak is that of Tad Patzek and Greg Croft. (Energy, Volume 35, Issue 8, August 2010, Pages 3109-3122) In that paper the authors had inserted a predictive graph on coal energy production rate, as follows:

From Patzek and Croft

As you may note, this suggests that we are right at that cusp of peak production and it is all downhill from here. With the major sources of energy for the planet currently coming from coal and oil, and with the recent comments both from the IEA and the Joint Services Command about the peaking of oil, that would transfer a lot of the load to natural gas, which is the third major source, according to the IEA. (And it should be noted that P&C did include the following from the IEA in their presentation.

IEA predictions of future energy supply sources (after P&G)

Gregor Macdonald at Seeking Alpha has recently highlighted the increasing world consumption of coal, which is rising much more rapidly than that of oil, which has almost stabilized. Much of that demand is coming from China, India and the growing economies of Asia.

Gregor MacDonald:

Much of the argument however for peak in production begins with the decline in the production of British coal. Famously, before the first World War, Winston Churchill converted the British Navy from the use of coal to that of oil, despite the UK having, at that time, no known indigenous oil supply yet having plenty of coal. It was a decision followed by Navies around the world. Britain still had the coal, - there were other reasons for the change.

Following the Second World War Britain had to rely on coal as a domestic and industrial fuel, and, in 1947 it nationalized the mining industry. As a part of that process it carried out a detailed physical inventory of the coal reserves of the country. That inventory has been published, and can be summarized in this table:

(From Trueman)
In the post-war years British coal production peaked at about 220 million tons a year in 1955.

British coal levels (Source Open University )

Current demand, as you may note, is just over 50 million tons a year – which might suggest that the UK has about 900 years worth of coal available.

But that is apparently not the case. If you look at a couple of data points, the World Coal Outlook, and then the BP estimate of reserves for 2005, there is nowhere near that amount of coal in the reserve:


The story is told in the difference between the resource and the reserve. At the present time folk would have you believe that the UK has very little coal left (4.5 years according to the BP report, from 2005, which suggests that the country is only staving off running out, since it is using about a quarter of that a year, by relying on imports).

So where did the coal go? Did some evil Voldemort-type character sneak into the country over night and magic it away? No! As the World Coal study shows, the coal is still there. It is just that, at the present time, the coal is not economically mineable and so it is not considered a reserve. It is, however, physically, still there, and thus, is still shown in the first column as a resource. And as the price of oil rises and the price of alternate fuels rises, so more of that resource will become a reserve. As a single example there has been talk of putting a new underground mine in at Canonbie in Scotland as part of a long-term plan to supply the Longannet power station.

It is thought that deep seams run for miles underneath the Canonbie area and could yield 400 million tonnes of coal, enough to keep the Longannet power station going for the next 80 years.

You may note that the 400 million ton figure is twice the volume that BP considered the totality of the British Reserve in 2005.

The predictions of the imminent death of the Coal Industry are likely thus to be somewhat premature.

Now let me close by addressing two other points. One of the technical advances that moved so much of the British reserve into the resource column instead was that it became, with the advent of larger mining equipment, much cheaper and simpler to mine coal from the surface deposits of places such as Wyoming or Queensland, than it did to mine it from underground. When the basic technology is not much more complex than using larger and larger shovels to dig the coal out of the ground there is, as yet, no need for the more complex technologies that might, at greater expense, make more of the coal a reserve, rather than a resource. The world has more than enough coal, and coal producers that its price is largely kept down by competition. (Technology was the second part of my ASPO paper, though I will forego going down that part of the argument in this post).

Consider, for example, that until recently Botswana found that it was cheaper to buy the power that it needed from South Africa, rather than expand its own coal-fired power system. Then South Africa decided it needed that power itself and so Botswana was thrown back on its own resources. It is expanding its sole coal mine and installing additional power stations to raise generation from 120 MW to 820 MW. In the process they have established that the coal deposits in the country may well be up to 200 billion tons of coal. However, since there is not that much demand, as yet, and Botswana is a land-locked country only 17 billion tons are currently counted as a reserve. However there was a strong Chinese presence during my visit there, and the situation may therefore change.

I won’t comment much on the growth of coal in China, which is moving toward consuming about half the world’s production, Euan Mearns has just covered that in a much better way than I might. But I would add some thoughts to his post.

Firstly the Chinese have been building a lot of coal-fired power stations, and are unlikely to have built any of them without an assured supply of coal for each. Secondly this is not the only market for coal in China. I was in Qinghai province, over by Tibet. The province gets most of its power from hydro, but uses coal to power the brickworks that are ubiquitous in the region, as dwellings are being converted from mud-brick to fired brick.

China has a domestic problem to keep the many regions happy with the central government, and this is causing them to put in massive amounts of infrastructure to allow access to all regions of the country. It is at a scale much greater than that I have seen anywhere else, even in remote regions, such as some of those I travelled. Rail and truck transport of coal is not the only way it can be shipped. Coal pipelines are an alternate way of doing it, but oddly, whenever the technology reaches a point of serious discussion freight costs seem to reduce, at least temporarily. I do not see, therefore, that over the longer term, coal supply to the various power plants being as great an issue as others foresee.

My overall conclusion is, therefore, that there is plenty of coal. The price is kept down by its international availability, and because it is so ubiquitous I anticipate that as oil becomes more expensive, so the nations of the world will, increasingly move to using this as an available reserve.

P54. Pick Points

So here it is the weekend, and I would usually be putting up Saturday Pick Points, and the Saturday post, with Sunday’s Tech Talk in the wings. However, since I am still wandering around Europe (tonight I am in London, but leave early in the morning for Dumfries and Burns Country) I am, instead going to take a quick peak around and do sort of an abbreviated Pick Points, looking at some half-a-dozen or so stories that are worth a quick look.

Getting around as I do involves a fair bit of travel by plane, and I’ve noticed that the planes seem to be getting smaller, and thus fuller, as the economy spins away. Of course the increased traffic might be because some travelers, can’t have a new jet of their own, though I doubt it. China is now providing its suppliers with increasing quantities of jet fuel, perhaps suggesting that while the rest of the world is cutting back , they continue to grow. Cutting back is almost the universal cry, and certainly the restaurant business has to be hurting. And I have eaten in a number of places recently where I was one of only few customers. Of course sometimes it is because, when I go to places like the Fem Sma Hus in Stockholm I show up at American dinner times not European (most of my meal I was alone in the cellar, but just before I left it became crowded). This lack of demand hurts chef employment, in NYC the restaurant trade lost more than 10,000 employees in the three months over the end of the year, nationally the drop has been more than 100,000. And with reduced waitstaff, in more popular places this can catch management out when there is an evening surge in demand. Which may “earn” you a free glass of wine as it did for me tonight in London. Sadly, however, sales of alcohol often pick up in troubled times, as they are now in Russia, while the harsher economic environment means that the smaller firms are pushed out of the trade.

Robert Rapier has noted that this is a good time to pick up alcohol – though he is talking of the ethanol variety in his most recent column at R-Squared Energy Blog: Valero Now in the Ethanol Business. As he notes VeraSun, the nations second largest ethanol manufacturer, filed for Chapter 11 at the end of October. The corporate assets are now on the block, and Valero Energy stand to pick up the seven ethanol refineries, at a quarter of the construction costs. Other ethanol companies have already filed for bankruptcy protection, and it appears Aventine may soon be in similar straits. Yet even as these sales start, the scale of the volume that ethanol will contribute, relative to the coming need is small, and while it provides, as Robert notes, an easy way to pick up a fuel that is being mandated as part of future supply, for small change to the oil companies, it is not going to be more than a contributory part to the answer. Yet, at the moment, despite that mandate, farmers are planting a greater fraction of the crop in soy beans this year, anticipating a bust in corn prices (which prophecy might be self-defeating). On the other hand if the import tariffs are reduced, as some in the Senate suggest, we may be able to import all we need. (But wasn’t there this slogan about freeing ourselves from imported fuel dependency?) Even the Wall Street Journal has weighed in against ethanol, though that also gives me the chance to make a small technical note. Unless I am doing something stupidly wrong (not unlikely) American Kindles can’t yet pick up magazines and papers in Europe (neither Sweden nor the UK). So much for my plan to save weight in my carry-on baggage by just loading the papers to it – Rabbits! Though I guess they may have other bigger troubles.

Solar panel advocates can no doubt breathe a sigh (though they said it was rather a shout) as the final Space Station panels were successfully installed. The station now has enough power to allow double the crew. Down on Earth the Administration is making its first Federal loan guarantee for alternative energy. The guarantee is for $535 million and will help construct a PV facility that can generate panels to produce up to 500 MW per year. The panels are designed for use on rooftops. The world’s solar PV installations are stated to have reached a combined total of almost 6 GW by the end of last year with Europe getting 82% of the business to date. (The ranking by country is Spain, Germany, USA, Korea, Italy and Japan). Sales are thus on a positive upward trend, with DuPont estimating a trebling of sales by 2012. First Solar have also just announced that they have now produced 1 GW of their solar modules, so with manufacture gearing up, all we need now is the market growth.

The other major renewable, wind power, is also gaining market, with a new effort to put turbines into South Africa. The country, as you may remember, has had problems with suppling power, not only for its own needs, but that of its neighbors. The first 30 MW farm is not scheduled until 2011, which won’t help the intervening shortages. It will, however, quadruple capacity. Eskom – the main SA power provider needs a rate increase, but is having trouble getting its act together, and having a power failure at a rally to improve their public posture sure doesn’t help. It is frustrating enough to Botswana, who got most of their power from SA, that they have started seeing pink elephants. (Would I lie to you ?). Of course it’s not just the South Africans that can run into infighting over turf relative to wind power, though the new Interior Secretary promises to get it stopped.

And finally (as the clock kicks over here in London) it is 4 years ago that Kyle Saunders and I first posted our collaborative effort that was, and is, The Oil Drum. I have posted a short history of the site, over there, and repeat the very best wishes that I have for the site. It has filled a valuable need, and that will not diminish in the months and years ahead, and so my wish that the site “Live long, and Prosper.”

More stories can be found at The Energy Bulletin and Drumbeat at The Oil Drum.

Making Decisions at a local Utility.

It has become almost routine to glance over at Energy Shortage, and see the same names of places around the world where there is insufficient power to meet local needs. Parts of South Asia are a constant presence, usually Bangladesh and Pakistan, with occasional appearances in India. Yet it seems somewhat remote from our daily concerns, both in geographical distance and in the scale of severity of their crises. One of the reasons for that constant presence is that once a shortage of energy develops it is not something that can be fixed overnight. It is the same in Southern Africa where the shortage of electrical power from South Africa has led to load shedding (a euphemism for blackouts) in neighboring countries as their allocated levels of supply have been cut. Botswana, for example, has one power station, fed from the one coal mine in the country. When the South African situation forced them to rely on their own resources for power, they set out to build new power plants, and create the mines to serve them. But implementing such a plan takes time, as does reaching the agreements to move forward. So, for Botswana,

Subject to the conclusion of all project agreements and execution of loan agreements by the middle of next year, commercial operation of the 1 320MW power station was expected in 2012 or early 2013.

Part of the delay in having these agreements in place was that almost no-one saw the energy crisis that happened in South Africa last year coming. But now consider the situation of countries such as the United States or Britain. Surely, the general public will tell you, there is no way we can get into the same situation as Bangladesh, or Botswana. But in the same way that it takes a long time to solve the problem of a lack of power, so it takes some time, usually for it to develop.

The South African crisis came when the demand for power rose at the time when, as it then was, the economy boomed to new heights. But the lack of maintenance and planning had set them up for the crisis over a number of years.

So now the world is in a time of serious recession, and the amount of oil and natural gas that is required to make the wheels go around is reduced. The exact amount that will bring us into balance between supply and demand is still being worked out as OPEC tries to limit production as a way of raising price. But while that effort is going on there is another disquieting event, or rather non-event, since it is the stalling of plans to increase power availability downstream.

Remember that we can, simply, divide power into two parts. The first part is the liquid fuels part of the equation, and that focuses to a large extent on transportation, and that is where the attention is currently, since having more than enough fuel means that the price drops at the gas station. The other part of the situation is in the generation of power, mainly electricity. This is a lot less fungible a commodity, in reality, since there is only a limited capacity for importing electric power (depending on the country) when you fall short.

Electric utility companies have long understood this, and built a margin of excess capacity into their plans for the future. But to be able to do that effectively, and with responsible care for the well-being of their shareholders, they need to have a reasonable sense of what the market growth will be, and what will be the rules under which newly constructed power stations will operate. If the State is like China, then it becomes easier to decide to increase the number of nuclear power stations, as they have. In a more fragmented society, such as ours, the decisions fall to the (relatively) smaller market providers who provide power to the different regions of the country. These individual utilities must decide, based on projected demand, how they will expand to meet that need.

In recent days that decision making process has become more complex, with the emphasis by the new Administration being placed on Energy Efficiency and a reduction in demand, rather than an immediate growth in supply. At the same time there is talk of change in the rules on burning coal, and the need for carbon capture and sequestration, with little guidance as yet on how much this will cost, or how it must be done.

So where does one turn for answers? There is a fair amount of ideological fervor in some of the comments coming out of Washington at the moment, but for all that talk the utility must also consider that the lead time for plant permitting and construction is such that the current Administration will likely not be in office (at least with the present office holders) by the time the new plant is finished. The rational answer may well be to look at the advice that the Electric Power Research Institute (EPRI) provides. The Institute has just issued a report on this very topic, Assessment of Achievable Potential from Energy Efficiency and Demand Response Programs in the U.S. (2010 - 2030), and the summary conclusion reads as follows

The U.S. Energy Information Administration (EIA) in its 2008 Annual Energy Outlook (AEO 2008) projects that electricity consumption in the U.S. residential, commercial, and industrial sectors will grow at an annual rate of 1.07% from 2008 through 2030. Energy efficiency programs have potential to realistically reduce this growth rate to 0.83% per year from 2008 through 2030. Under an ideal set of conditions conducive to energy efficiency programs, this growth rate can be reduced to as low as 0.68% per year. EIA projects that peak demand in the United States will grow at an annual rate of 1.5% from 2008 through 2030. The combination of energy efficiency and demand response programs has the potential to realistically reduce this growth rate to 0.83% per year. Under an ideal set of conditions conducive to energy efficiency and demand response programs, this growth rate can be reduced to as low as 0.53% per year.

These estimated levels of electricity savings and peak demand reduction are achievable through voluntary customer participation in energy efficiency and demand response programs implemented by utilities or state agencies. The estimated cost of implementing programs to achieve realistic potential savings ranges from $1 to $2 billion in 2010, growing to $8 to $20 billion by 2020, to $19 to $47 billion by 2030. This analysis does not assume enactment of new energy codes and efficiency standards; more progressive codes and standards would yield even greater levels of electricity savings and peak demand reduction.

One of the implications of the above is that, if the right rules and standards are enacted, then it is quite possible not to see any growth in demand over the next 20-years, but rather that demand will remain static, as growth is met by increased efficiency. And this appears to be the goal of this Administration.

Unfortunately for the utility board, while this is a generalized picture for the country as a whole, it is less easy at the local level to pronounce that there will be no growth in power. Which makes it a little more difficult to change the mix of the power supply, if current plant can meet the demand. (Which may be why solar and wind farm operations are beginning to find it more difficult to make sales).

The down side to this encouragement to inertia is that should demand grow, as the economy also comes back out of the recession, then the new supply to meet any unanticipated demand for additional power will likely not be there. And oops! We, or some states perhaps, might find ourselves/themselves in the same sort of condition as Botswana is now in.

Rural Electric Systems

The world is in recession. And with the drop in demand for different fuels, it becomes a little harder to see when we will return to the teetering balance between available supply and demand. Certainly the price increases that happened last year have not totally dropped back and eased the discomfort in places such as India. The current price of gas remains high out of Russia, and the agreements that Eastern European countries will now pay prevailing prices for their gas, will be an increasing burden on their economies.

There is, however, an underlying desire by governments in the less well-developed countries to increase the availability of electricity to their rural regions. Whether it be in Africa or Asia, the arrival of power in a village can make a drastic difference in the quality of life. It has been suggested that the initial impact, however, relates more to female than male employment. And yet levels of penetration are not yet that great. For example, Botswana has about 12% connectivity, while Zambia is estimated to have only 2.2% connectivity. Many of these countries, with the aid of foreign governments, intend to radically improve these percentages.


The original target for Zambia was to have 50% access by 2010 and the country is concluding an agreement with Japan for $550 million with a grant from Sweden for $30 million also in the works. And yet current power outages make even the existing network insufficient to meet the need, with health centers being reduced to working by candle light. However, in contrast to Zimbabwe and Botswana, Zambia generates most of its power from hydro-electric sources, and the failure of one of the turbines has exacerbated the current problem.

The shortage highlights, however, the problems in creating a new set of power sources to meet the needs for the rural program. It is not sufficient to provide the connections to the grid, if the grid is not itself sufficient to meet the needs it will face. For Zambia the immediate solution is the construction of the Itezhi-Tezhi 120 MW power station. and increasing the capacity of existing hydro-electric schemes. In these efforts the partnerships are being formed with Indian and Chinese contractors.

Boosting hydro-electric production is also seen as helping in Bhutan, where the Asian Development Bank is funding the Green Power Development Project which will not only provide power to rural Bhutan, but will also provide export power to India, reducing their need for fossil fuels.

In Mali Jatropha has been used to produce power in a pilot plant at Garalo . At present the plantation has been formed, but it will take a couple of years to generate the seeds (one gets around 2 kg/tree/year) in sufficient volume for the plant. A ton of seeds produces 250 kg of oil, and 750 kg of filtercake, which can be used as a fertilizer. The oil has to be pre-heated and filtered before it can be fed into the generators, of which the village has 3 at 100 kV.

Jatropha is not, however, as productive as was once thought, with collection being more labor intensive and yields being relatively low at around 2 tons per hectare. Thus originally optimistic projections for its use are now being qualified. Yet just today a relatively large (180 million gallon/year) refinery has been announced. A market for the fuel has been helped by the passage of the Biofuels act in the Philippines that requires that 1% biodiesel shall be blended into fuel in 3 months, rising to 2% in 2 years. The only alternative to jatropha in country at the moment is a plant that produces coconut oil, and that is meeting 55% of the current demand for biodiesel.

While biodiesel has, therefore some advocates moving forward, as a fuel supplement, and can be used for power generation, quite often the funding initiatives have been oriented towards solar electricity. Schedules are provided, for example, that show that 5 sq m of solar cells will supply a school with 16 lights, power for a projector, and a socket for a small electrical device. Solar also has the benefit of being installable in areas that are remote from the grid, and where running power lines would be expensive.

The Green Power Development project in Bhutan is one such, and supplies for 100 communities are planned in that endeavor. As I mentioned recently, the initial trials of the technology have gone over well with the nomadic yak herders, reducing their need for firewood and kerosene.

Herders from Nubri and Soie Yaksa said alternative energy technologies like solar lighting and the one- and two-holed metallic solar cooker were very useful and convenient. “The small portable solar light is the best. We can take it along with us whereever we go,” said Tobgay from Nubri.

Nado from Soie Yaksa said that use of solar had reduced the danger of burns, cooking time, and saved firewood. Norza Gem from Soie Yaksa said that she could cook faster, churn milk and round up cattle at night.

A report from CORRB states that the use of kerosene has been reduced by 90% in these areas.

. One of the recognized problems is that of maintenance and repair. This can be partially overcome by having the lamps etc rented, and recharging them at a central facility. Such an operation in Laos has grown into a small business. In Bhutan, however, they recruited local women to learn how to deal with the problems. The Barefoot Solar Engineers had to walk 5 hours to a local road and then on to India’s Barefoot College in order to learn how to do the repair, and one of the engineers now maintains systems in 30 villages – not bad for someone whose formal education stopped at grade 5.

There are many such encouraging stories of such a nature at the local level, and from them one can anticipate that electricity demand will grow steadily. But the next question will come as demand rises above that needed at this scale. But then that is a topic for another day.

Coal in South Asia

Over at Salon, Joseph Romm has a column today explaining the deep credentials of the current Administration team that will be addressing the global warming issue, and more particularly the controls on coal-powered electricity generation that they can expect to bring with them. This post is not however about the arguments that make up that decision, but rather to suggest that if the Administration is going to address this as a global problem, then they need to talk to many more countries than just China.

Consider, if you will, just two parts of the world – Southern Asia (and I will include India, Pakistan and Bangladesh in this) and Southern Africa. For these countries, none of whom yet have full rural electrification, the rising price of oil and gas is already causing serious impacts on their ability to function. When load shedding is more common than load supply then running a plant/factory/restaurant that relies on electricity becomes more difficult and more expensive, and the entire economy suffers in consequence. If fuel is not available for the irrigation pumps needed for the rice harvest, then the national ability to feed itself becomes threatened. But if the cost of importing fuel exceeds the ability of the country to pay, then domestic alternatives, and in these cases that means coal, become more attractive.


It is becoming grimly clear to the three Asian countries that I listed above that they can no longer afford the rising prices the world is being asked to pay for oil and natural gas. Bangladesh is facing a 30% shortfall in electricity as it goes into the growing season for rice, Pakistan can no longer pay the bills to provide oil for its power stations, and India is looking at a shortfall of 25% between electricity demand and affordable supply. India and Pakistan are hoping for pipelines to bring natural gas from Iran and Turkmenistan, since India can only produce 60% of the natural gas that it needs, but the tensions with Pakistan, through which both pipelines would have to run, are making their viability less certain.

The problem only gets worse as those nations that are exporting natural gas, such as Turkmenistan, have now persuaded the Russian government to pay the “going price” for their product. This is, in part to stop competing pipelines, such as Nabucco, that bypass Russia, from cutting the Russians out of their deal with the West. But in the process this price rise is making it harder and harder for other countries to compete in this marketplace for a viable quantity of fuel. There is no pipeline as yet to carry Turkmen gas into South Asia, and while talks still continue, the price for the product, in the end, may be more than the recipients can afford.

Domestic supplies of natural gas are insufficient to meet demand, and what then is left? Certainly nuclear energy can play a part, but the remaining cheap alternative (and these are generally poor countries) is increasingly seen to be coal. And so Bangladesh is biting the bullet, and going forward with a national policy on coal. It is also building coal-fired power stations, since at present it only has one mine and one power station and gets less than 5% of its energy from coal. The problem now comes for the mines that are planned on the surface, since while the existing underground mine has little surface impact, surface mines can be expected to displace all those currently living on the site. This has previously led to riots but in the need for fuel politicians are changing to see coal as being something, perhaps the only something, that can meet their needs. The coal that they have is of good quality, and production is planned to increase to over 20 million tons/year within the decade.

India already gets some 53% of its electrical energy from coal , and has estimated reserves of 264 billion tons, with a proven reserve of 102 billion tons, 80 years at current rates of consumption. Coal India Limited (CIL) mines 84% of India’s coal feeding 72 of the 75 thermal power stations in the country (64,285 MW) with the 380 million tons they mine. Their sales brought in $9.69 billion of which $1 billion went in tax.

Because of growing demand, expected to rise to 730 million tons by 2011-2012, CIL will increase its production to 520 million tons, rising to 664 million tons by 2016-2017. At present 84% of the coal is mined at the surface, though this may only last some 30 more years. It is not of very high quality. CIL recognize that mining will thus have to focus more in the future on underground production. Indian coal needs to be cleaned to meet international standards at higher prices, and so the company will also invest in larger coal washeries. It has planted 69 million trees as part of land reclamation after mining. With 473 mines and 424,000 employees, CIL claims to be the largest coal producing company in the world. However because it currently can’t meet demand, India is increasing coal imports to more than 8 million tons.

As for Pakistan, coal has fallen considerably in grace from earlier years, and now only supplies 7% of the fuel, and 0.2% of the electricity to the country from a single power plant. Natural gas has largely come from Balochistan, but increasingly unrest in that region of the country, the poorest region in the country, is making the supply less reliable, and demand is outstripping supply, leading to load shedding. Pakistan has very large deposits of coal (it claims the fourth largest reserves) and the Chinese are interested in helping them exploit these.

Space limits my comments on Southern Africa today, but it should be noted that the Chinese are helping Botswana exploit their coal deposits and build new power plants, and, after the debacle over power shortages last year Eskom in South Africa is expanding their coal and power production to try and catch up with demand, and the new power stations may be coal-fired, rather than the original plan for a nuclear plant.

Load Shedding, Blackouts or becoming more vulnerable

Load Shedding is one of those terms that has started popping up in more stories than it used to. Mainly they are stories that relate to distant, foreign parts, such as South Africa, and are thought to be avoidable events for more advanced countries. Load shedding occurs where demand for power from an electrical utility exceeds the amount of power that the utility has available. In order to avoid creating undue havoc (there are a lot of systems that can only operate when power is supplied within a very narrow envelope of voltage) the power company then selects part of the load (i.e. which unlucky customers) it will no longer supply. It then shuts off the power to that group (shedding the load) so that the rest of the customers can continue to have power. It might be considered as a localized blackout, (as is happening in Western Ireland) except that if it is handled correctly it might have much less of an impact

I teach a class that involves, among other things, the use of power in mines. I was discussing how, in looking at the way in which power is used in those mines, prudent managers would designate the power going to different parts of the operation as vital, sheddable and avoidable. Some things, for example the large fans that keep air circulating through an underground mine, are vital to its operation. Some things, such as the operation of the pumps that drain the water from areas of the mine prone to flooding, can be rescheduled, in many cases, to off-peak periods, and some power use – such as running a conveyor when there is no production taking place, or keeping the lights on at the surface during daylight, can be eliminated. So I was talking about this, and three of the folk in the class commented that they had worked in mines in the United States, during the summer, and the mine had been asked to shed some load by the utility.


The most dramatic visible load shedding was, perhaps, the collapse of the power distribution network in Southern Africa, about this time last year. Essentially the power company ESKOM, had failed to keep up with demand, by properly maintaining the power stations and supplies, and planning ahead to match available production with the increasing demand that they were facing. The problem was not, however, limited to South Africa alone.

In the northern part of South Africa around Johannesburg, there are a number of coal mines and power plants. Surplus power could be sold into the neighboring countries to the North, so that they did not need to build their own plants, or start to develop their own deposits of coal. One such place was Botswana, just across the border, which had, at the time, one power plant, fed with coal from one mine, and with that mine having one mining machine to produce the needed coal.

Botswana is not yet a fully developed country. Only 35% of the population has access to electricity and until January 2008, they had assumed that their shortfall in domestically generated power would be made up by imports from South Africa. Their economy was booming, and their increased demand for power was being driven more by industrial growth than by rural electrification. And then in January, South Africa discovered that they no longer had enough power, and started load shedding. Given that they didn’t bother to inform the average person in Botswana before they did, a little disruption ensued. (http://allafrica.com/stories/200801280174.html).

I was down in Botswana a little later in the year (February) and this was the story that I posted to The Oil Drum at that time.

“I had mentioned earlier the problems that that country suddenly encountered when the source for 75% of its electric power – Eskom of South Africa – started to use it as a load-sheddable part of its distribution chain. It has since given Botswana the amounts that it can expect over the next four years. From a supply of 410 MW in 2007; it will get 350 MW in 2008; 250 MW in 2009; and 150 MW in 2010 through 2012. While the country has in-house generation, it decided some time ago that it was less costly to import power than to increase internal supply. Now it will take some time to create that internal power, from coal, of which the country has a more than adequate supply.

The expansion of the current plant, already in process, will not occur until 2010, and was planned to only add 120 MW, less by then, than the lost imports. And current growth in demand has been at 5.6% per annum. It does not help that:

It has also emerged that at the beginning of this year, the desperate BPC signed a no guarantees contract that allows Eskom to cut power supplies to Botswana within as little as ten minutes notice.

Flying into Gaborone, the capital, from Johannesburg, after reading the articles that had lead to the earlier pieces, I had expected to see that there would be some impact on behavior. But, crossing the veldt, there were lace points of light that reached out as long as I could see the ground. Once landed the streets were lit, and gas stations were running normally (at about $1 a liter). Going into meetings the following morning, it seemed to have been, at that scale, an irritant. We continued to meet, and then the lights went out, and the air conditioner shut off.

There were a couple of remarks, and we continued with the meeting (which wasn't about this), and about fifteen minutes later power came back on. There is no sense, from those I talked to, as to when each outage will occur, nor how long it will last. And what is an inconvenience in a discussion, becomes much worse, for a business. Longer outages have led to spoiled meat at restaurants and it is perhaps not surprising that virtually all the meals we had were served as buffets.

The problem was foreseen, and, as with the current world oil situation, there were voices that expressed concern. But while demand continued to grow, supply did not. Maintenance was not adequate, and there has been a continuing economic crisis in neighboring Zimbabwe which has led to their power stations shutting down, and power distribution collapsing.

The nation was sitting at the start of what looks to be a very promising future. As commodity prices rise it has the world’s second largest diamond mine as well as other, increasingly valuable minerals. The second largest industry is tourism, with beef production running third (it is the size of Texas, but has perhaps a sixth the size of that herd). Plans were well underway to increase electrification of villages, which had been only at around 12% toward universal access to power by 2016. Unfortunately, due in part to lack of training, use of solar power has not been as successful as had been hoped. And now, not only is there no new power to meet these future needs, there is not enough even for today.

So the Power Company has been scrambling to find answers wherever they can. Obviously there are some conservation measures, which include

replacement of incandescent lamps, which consume a lot of power. The director of transmission at BPC, Edward Rugoyi said the project is aimed at reducing power consumption to 30 MW by June this year.

Implementation will cost the corporation at least P20 million. Another initiative BPC will look at is load shifting, where the organisation will control domestic water heating by switching off water geysers during the peak period by using controls installed in their systems. Rugoyi said the exercise will cost P60 million and it is planned for May 2009.

(The currency is the Pula, at about 6 to the dollar. They are coming out of summer, so air conditioning will not be an immediate burden, though it can get cool in the winter, that is still some months away.


Morupule Power Plant

For the longer term, the plan is to increase power from the Morupule Power Plant, to a new level of 300 MW, helped by the Chinese , tenders have been accepted to expand the Morupule plant to 300 MW by 2010, with incentives for fast-tracking. In the more immediate short term, Botswana has agreed to work with Zimbabwe in restoring and operating the currently dysfunctional power station at Bulawayo in Zimbabwe, with countries sharing 50:50 in the power produced from the coal that Botswana will supply. This will require new transmission lines.


New Power Transmission Lines near the Zimbabwean border in Botswana

In short – depending on how successful the arrangement with Zimbabwe turns out to be, Botwsana may have less than a year of discomfort, and, if the Chinese can perform to schedule, no more than a couple before becoming sufficiently independent of outside power supply that it can return to its planned progress forward. Much of that progress will likely build on the growth of the local mining industry, which is fairly energy dependent (as the South Africans are now well aware). Thus the plan is to continue to increase the size of the Moruplule plant with another 300 MW, once the first phase is completed.

Following the visit, and that story, I was pointed to a Web site – Energy Shortage that illustrates the places around the world where energy shortages are currently occurring. Among the countries that are listed for today (January 8,2009) are:

Argentina; India; Indonesia; Ireland; Nepal, and South Africa.

Note Ireland, it is a reminder, as power stations have started cancelling plans for expansion in the United States, of what might be coming to our light switch, if the correct planning is not put in place, now!