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The merits of a solar cluster

10th December 2010

By: Saliem Fakir

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The solar park idea raises the question of how South Africa should be positioning itself to take advantage of the country’s abundant solar resources.

 

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The solar park idea is an element of a broader solar cluster concept. India has termed its own solar cluster initiative the National Solar Mission. It aims to install 20 GW of solar capacity by 2022, covering a range of technologies.

 

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The solar cluster idea should also be a way of leveraging the greatest potential to create a strong industrial base for solar industries, to be competitive and to maximise our nascent intellectual investment for innovation.

 

The introduction of the renewable-energy feed-in tariff takes place in the absence of an industrial strategy, and, if this persisted, we would squander the alignment that could be made between solar-to-scale and localisation.

 

South Africa’s solar cluster platform can be used to form tactical alliances with countries that are expanding and occupying the solar space very rapidly, such as China and India.

 

For this to happen, a solar industrial zone must be established to optimise entrepreneurship, the deployment of capital, the use of limited skills and the creation of centres of learning and innovation. There is no point in stimulating investment in demand without also building an industrial base.

 

We are sure to be subsidising market opportunities for others when we have the capacity to reap benefits from our own domestic market.

 

The solar cluster would comprise three elements:
• Limited and strategic photovoltaic (PV) units. Thin-film PV may be a good option because we have some intellectual property in this field already. PV is already a highly competitive product globally and South Africa is unlikely to catch up in terms of advancing its own industrial innovation other than through joint ventures with overseas producers. There are niche opportunities in South Africa and Africa that can be taken advantage of.

 

• Solar water heating (SWH) systems can help manage peak demand and has the highest job-creation potential of all three – they have value in their own right. Eskom’s one-million system roll-out needs impetus. Both demand-side and supply-side solutions to ramp up diffusion and manu- facturing capacity in the country are needed. Cheaper imports can threaten the domestic market. A carefully crafted industrial strategy would be needed, as would creative ways of financing rapid uptake and diffusion of SWH systems.

 

• Concentrating solar power (CSP) is a nascent technology that is fast developing, in which South Africa still has the opportunity to develop a competitive advantage. Eskom has already done a spec for an indigenous 100-MW CSP tower plant and, having received money from the Clean Technology Fund, is going ahead with the project. Implementing more and more of these helps us gain valuable technological experience.

 

Catching the CSP wave at the right time may hold long-term strategic industrial benefits for South Africa.
A solar cluster – and if we just take CSP as an example – offers other advantages beyond just the supply of electricity or its substitution. There are several things to think about:

 

• Specialisation in the optimisa- tion of CSP plants and other solar technologies adds value through improvement in knowledge, gaining experience from the management of large-scale plants or utility- level models. This is an exportable commodity.

 

• The development of new uses for CSP through the generation of process heat or direct solar steam, tailoring CSP development for desalination plants and the production of solar fuels such as the production of oxygen and hydrogen are another area.

 

• Supporting innovation in the development of hybrid renewable plants.

• Innovations in storage capacity and dispatchability technologies.

• Innovation in business and service models because CSP has modular plant/ utility application.

 

Scale attracts investment. A good example of this is the Square Kilometre Array (SKA) project, which, incidentally, was crafted on the basis of a strategic choice and not on any good financial reasons.

 

If South Africa wins the bid to hold the SKA, it will be a global hub of activity for the development of new radio-telescope technology and a scientific observatory for the celestial skies. There will be significant business and technology development opportunities.

 

The main advantage of the solar cluster is the leverage of the domestic base to drive industrialisation and the manufacture of solar systems. Not all the three technolo- gies have global competitive advantages for South Africa. But, acting within a cluster, they can reinforce one another in areas where there are overlaps.

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