The power division of JSE-listed industrial group Barloworld is positioning its business to “sell kilowatt hours” and not only power equipment, with an aspiration to become a leading independent power producer (IPP), offering peaking power solutions across the power-stressed Southern African region.

Barloworld Power executive director Kenny Gaynor tells Engineering News that the group’s R250-million turnkey project to supply NamPower with a 21,5-MW diesel-fuelled, peaking plant on the Namibian West Coast will become a “reference site” for its technical and project expertise.

However, he says that it is also pursuing several other projects in the region, which could involve plant operation and the selling of electricity, “not just engines”.

It has submitted tenders to supply power to major mine-linked projects in Botswana and Mozambique, while it is assessing other earlier-stage opportunities in Angola, Namibia, South Africa and Zambia.

“We are watching the IPP landscape with interest,” Gaynor enthuses, adding that the division expects to play a role within the South African marketplace once the environment is conducive to meeting the target of having 30% of the country’s power being provided by private producers.

The group’s focus is on using Caterpillar’s diesel-fuelled, gas-based, or heavy fuel oil power-generation solutions, targeting a power plant range from 1 MW to 80 MW.

Gaynor notes that, internationally, the renewables market is accelerating through increased investment and focus. In the context of a supply model where variable renewable-energy sources receive pricing and grid access preference within the framework provided by the renewable-energy feed-in tariffs, this scenario could very well play itself out in South Africa. Gaynor adds that Barloworld Power is evaluating a solar/battery/diesel generator solution for the cellular network providers as a way of securing energy to what are often remote installations.

The company is, therefore, in the process of recruiting engineers and project managers to create the technical capacity required to provide utility-type services, initially to mines in the region, but potentially also into the grid.

Internally, this programme has been dubbed “from engines to engineering”, and several electrical and mechanical engineers have already been recruited into the division.

The division has also been segmented into two sectors, with the first focused on selling backup power products and solutions, and the second being established to design, build and potentially operate large power installations.

In South Africa, during 2010, the business is likely to focus primarily on providing backup power generation, as well as solutions to enable corporates to shift loads away from what will be increasingly expensive peak periods.

Gaynor anticipates that the 2010 FIFA World Cup will provide something of a demand kicker, with hospitals, police stations, restaurants, guesthouses and hotels and shopping centres likely to consider backup power for what will be the first winter World Cup in decades.

But he also expects demand to arise from within the manufacturing and mining sectors, which will seek to use generators to shift loads to avoid what could be significantly higher peak tariffs and/or penalties that could arise should the power conservation programme (PCP) be implemented.

The PCP seeks to set out mandatory power-consumption limits for large energy consumers, with prescribed fines for excessive consumption.

“We realise that a generator may be considered a grudge purchase and, therefore, Barloworld Power are increasingly designing solutions that could enable the generator to be used in an active role to support cost savings and energy efficiencies, rather than merely having it sit passively in a dark room somewhere,” Gaynor concludes.

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