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The AMEU Convention is exploring future proofing the digitalised municipal electricity distribution utility
Technological advances, collaboration and tariff rate consistency were some of the key themes that emerged during the first day of the Association of Municipal Electricity Utilities’ (AMEU) 70th Convention being held in the Kruger National Park.
During a panel discussion – Future proofing the digitalised municipal electricity distribution utility of the future in a low carbon economy and with focus on the energy market and the grid – AMEU Strategic Advisor Vally Padayachee, said that “it’s obvious that the grid has challenges and opportunities…”
The question is how municipalities are going to position themselves to deal with the challenges and take the opportunities presented in the changing energy landscape in South Africa.
Dr Willie de Beer, consultant and energy expert said “many of us are not geared for the competition in the sector.”
“All of a sudden we are confronted by bi-directional electricity. Customers have become prosumers. We need an integrated approach… if you don’t have a balance sheet, you will not be able to participate in the future energy market.”
De Beer called for a collective approach between the municipalities and Eskom as there is room for collaboration.
Distribution models discussed at AMEU Convention
Another energy expert and consultant, Paul Vermeulen, said we need to look at electricity distribution models along the lines of how for example, Amazon and Takealot operates.
“They own and operate distribution networks that connect many manufacturers to many customers. They move product and they ‘own’ their customers and they determine the rules of the game.
“Does this business model sound familiar?” Vermeulen asked.
Referencing several Distributed Energy Resources (DERs) like thermal power generation and PV plus storage at Joburg’s City Power utility, Vermeulen said these are needed to participate in the coming market.
Future proofing
AMEU Honorary Member Attie van der Merwe said rules for future proofing and where to invest must encompass the following:
Embracing the changing business model of bi-directional power flow with multiple players, mostly in the variable renewable energy (VRE) space
Analysing what’s “in for you” in the eminent market – don’t just be a price taker
Doing the preparation in splitting the business
Looking at the future required functions and skills
Latching onto operational technology (OT) and IT tools available.
“The future is changing rapidly,” said Van der Merwe.
He said in the future electricity market, which will move away from a “linear grid“, multiple suppliers will enter via wheeling or DERs.
Dhasi Naidoo, Chief Strategy Officer at Ontec Systems, said collaboration between the private and public sector will be key.
He said technological advancements in renewable energy coupled with the emergence of storage solutions as well as the advent of machine learning, among others, will require the business model of utilities to change.
He said the skills shortage, revenue gaps and trust gaps (in terms of taking the consumer on the journey) have to be addressed.
“There is no silver bullet… collaboration is required,” Naidoo told the AMEU Convention.
Panelists at AMEU Convention call for tariff reforms
Kadri Nassiep, Executive Director of Energy at the City of Cape Town said it was important to leverage public-private partnerships (PPPs).
The City has partnered with a private entity to deliver smart meters and has piloted a wheeling initiative.
Nassiep said it was important for the metro’s services to be flexible.
“The role we have to play in the alignment of services is critical.” |
