The 4,2-MW biogas-to-electricity plant was developed and financed by MethCap, a company owned by international engineering and environmental firm WSP Group, the Central Energy Fund, and NRG, a group of empowerment investors.
The biogas-to-electricity project was registered with the international CDM board on September 29, 2006, and took 11 months to construct. The crediting period for the project is fixed, and stretches from August 2006 to July 2016.
PetroSA has operated a gas-to-liquids plant at Duinzicht, about 12 km from Mossel Bay, since 1987. The production process at Duinzicht leads to waste process water that has been dealt with by way of anaerobic digestion. The anaerobic digestion is continuous and is a critical pro- cess for the operation of the PetroSA plant, and biogas is naturally generated in the anaerobic digestion process.
The plant is equipped with a smokestack that houses a flaring apparatus, whereby biogas has traditionally been flared. It is estimated that the equivalent of at least 1 300 GWh of gross heat value has been wasted in this manner over the lifetime of the plant.
The present project uses the waste gas usually flared to generate electricity to be used on-site by PetroSA. This means the corporation will need to buy less electricity from the national grid.
The plant will be owned, operated, and maintained by MethCap, the project developer, as an independent power producer, and will be financed from two essential revenue sources, namely electricity sales to PetroSA, and the sale of certified emissions reductions (CERs) under the CDM.
The project was not financially viable without carbon finance in the form of CERs, and faced investment barriers, as well as barriers of prevailing practice, and capacity shortcomings, besides others.
A vital requirement of any CDM project is that it should contribute to local sustainable development. In South Africa, this requires a balance of economic, environmental and social considerations.
On an economic level, the PetroSA project makes a contribution towards national economic development and the aims of the white papers on energy and renewable energy in that it adds to South Africa's energy supply, adds an independent power producer, leads to energy diversification and creates a source of renewable energy.
The project created work for more than 60 people in the planning and construction phase and, in the long term, work for two people in operating and maintaining the plant has been created.
"On a social level, MethCap has agreed to pay 7,5% of the CDM income towards poverty alleviation in the area. This initiative will be jointly managed by a specialised nongovernmental organisation, Ikamya Labantu (the future of our nation), and the Eden district municipality.
" The district municipality will report back yearly to the developer on how the funds were spent.
The environmental benefits of the project will be less greenhouse-gas emissions by the national grid, and the more efficient use of energy and resources in the country.
"The launch of the PetroSA biogas-to-electricity project indicates that the implementation of renewable-energy projects is not just a fantasy from government but is actually do-able. It is important to see this project as a catalyst for the development of other renewable-energy projects in the country," commented Minerals and Energy Minister Buyelwa Sonjica at the launch of the project.
"We believe this project will serve as an example of what can be achieved by thinking creatively and implementing high-specification technology in the developing world. The result can be a more efficient use of even more scarce energy resources, which also translates into good news for the local community and the environment," concluded MethCap MD Charles Liebenberg.