Potential savings when re–instating mine DSM projects

Abstract

The increasing electricity demand in South Africa has lead to a shortage in electricity supply. In response to this problem Eskom has introduced multiple capacity expansion programs. Unfortunately the electricity shortage is expected to continue until Eskom’s capacity expansion programs are completed. Demand Side Management (DSM) is widely accepted as an immediate solution to the high electricity demand of South Africa. Numerous DSM projects implemented by ESCo’s have been successful, but over the years have not been sustainable. Without regular maintenance from the relevant ESCo, many projects have failed to achieve sustainable savings. After the implementation of DSM projects, all installed equipment and software becomes the property of the client. Experience has illustrated that some mines did not always have the expertise or available resources to monitor and maintain the projects. As a result the electrical energy savings of the project would gradually deteriorate. A feasibility study was conducted to determine whether the re-instatement of redundant and debilitated mine DSM projects could be marketed as the “low hanging fruit” of the industry. A key driver for this study, was the fact that costs involved for re-instatement of such DSM projects are generally considerably lower than those of new projects, yet still producing lucrative electricity savings. Three major mining entities discussed in this dissertation have neglected to realise a collaborative cost saving of R 55,5 Million per annum. This loss of opportunity can mainly be attributed to a lack of maintenance and monitoring of operational DSM projects on their mining sites. Three DSM projects related to the water reticulation system of the mine were investigated. It was discerned in all three cases that the successful re-instatement of DSM projects are indeed possible, but only when subjected to continuous monitoring. The maintenance performed on two of the three projects, respectively realised approximately R2,7 Million and R 750 000. This was achieved through the process of load shifting, over a period of one year. Maintenance on the third project realised approximately R1,5 Million through energy efficiency over a three month period. This dissertation illustrates that attractive savings in electricity and cost can be realised when re-instating redundant DSM projects in the mining industry. It also demonstrates the cost and time effectiveness of implementing such projects, compared to the focus on new DSM installations.