Shale gas mining is a process that applies the technique of high-volume, horizontal, slick-water fracturing (‘fracking’ or ‘hydraulic fracturing’). It involves pumping water, sand and chemicals into horizontally drilled wells, under hydraulic pressure to fracture the underground shale layers and release gas.

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Alternative Energy

A range of environmental challenges underscores the fact that we need to make changes to the way we live.  Climate change is considered the current biggest threat to biodiversity, food security and water supply.  As part of reducing GHG emissions, we need to start investing in renewable energy (solar, wind, wave and more) and systematically reduce our reliance on fossil fuels.  The technological advances in renewable energy has made it more and more economically viable for countries to invest in these technologies and including them in the energy mix.  Before shale gas (which is a fossil fuel and contributes significantly to climate change) can be considered a feasible option for South Africa, have the alternatives and their potential for providing energy and reducing GHG emissions been considered?


A non-technical look at a real alternative to shale gas
By Jonathan Deal, Chairman, Treasure Karoo Action Group

Amid the clamour by oil and gas companies to adopt natural gas as the ‘new, clean-burning energy source’, solar energy has rapidly emerged as a sustainable and viable alternative. Supporting this trend are well-documented cost-reductions in Photovoltaic (PV) manufacturing and solar system installations.

Stephen Lacey, a US-based journalist with Climate Progress reports that cost reductions are driven by exponential growth in renewable energy systems. The report confirms the inexorable advance of renewable energy costs towards ‘grid parity’ – the time when solar becomes as cheap as fossil sources. It is predicted that the crossover is happening in phases – one market and one technology at a time. Solar has averaged a compound annual growth rate of 65% for the past five years; a figure proved by sales of solar components – installations in 2010 alone amounted to 17 gigawatts – about 40% of South Africa’s current generation capacity.

It suits producers of fossil fuel to dismiss renewable energy as ‘too-expensive’, ‘too slow to provide growing power needs’, and ‘incapable of maintaining base load energy requirements’. But actual performance statistics released in the last twelve months dispute claims by Royal Dutch Shell that renewable energy cannot provide the power that we need. Shell’s claim that it will take South Africa 20 years to develop sufficient renewable energy is inaccurate. According to Tom Dinwoodie of SunPower and Dan Shugar, CEO of Solaria, solar PV is no longer a fringe, cost-prohibitive technology – but, rather, a near commodity that is quickly becoming competitive with new nuclear, new natural gas and soon, new coal.

Since the mid 1970’s when PV manufacturing costs were R430 a watt, the cost has steadily reduced to around R10.75 today. Central to this predictable and continuous reduction in costs is a concept, well known in computer hardware circles as ‘Moore’s law.’ Essentially this maxim means that for every cumulative doubling of manufacturing capacity, costs will fall 20%. The solar industry can prove that its manufacturing costs have fallen about 18% for every doubling of production. When SunPower built the 14-Megawatt Nellis Air Force Base system in 2007, the project cost R50 per watt. Installation costs 3 years later were down to R21.50 per watt. In 2010, the average installed cost of solar PV dropped 20%.

And while Moore’s law doesn’t necessarily work on the system installation costs (referred to by industry as Balance of System – BOS) acquisition and installation costs are falling steadily, due, in the main, to advances in web-based tools that streamline sales and inspections, new wiring, racking and inverter technologies. The Rocky Mountain Institute, a Colorado based think tank of scientists predicts in its report Achieving Low Cost Solar PV (September 2010) that BOS costs will decline by 50% by 2015.

The brilliance of solar is highlighted by the fact that as a modular technology, it can be produced and installed at a pace far faster than most other energy technologies – in contrast with fossil fuel powered facilities. Naturally, the argument for a ‘base load’ resource as opposed to a ‘peaking’ resource must be considered, and gigawatt for gigawatt a nuclear plant will produce more electricity than an equivalent solar PV plant. But solar brings a different kind of value to the grid – it can be quickly deployed on existing infrastructure (warehouses, commercial buildings and houses) in a much shorter time than natural gas plants. It is non-polluting. And it is sustainable. It will create sustainable jobs. The Global Climate Network in a March 2010 publication stated that South Africa could create 145 000 jobs by 2020 if we pursued manufacturing of renewable energy components. In the stated timeline of Royal Dutch Shell ‘about nine years to production ’ this raises the bar for fracking proponents considerably – especially when one considers that gas wells are exhausted in a period of 5-10 years.

Shugar provides an astounding statistic: If only 500 megawatts of solar PV had been deployed in the northeast US to alleviate a power shortage, the 2003 US-Canadian blackout would not have happened. That blackout was the second largest in the world causing between R50-R70 billion in economic damage. Solar plants can supply peak power when it is needed most – on summer days when air conditioners and other cooling appliances are used. In areas like South Africa, where it is reported that we have more sunny days than New Mexico, solar is becoming competitive with large combined-cycle natural gas plants.

California has recently signed contracts for a combined 4 gigawatts of solar PV plants all priced below the Market Price Referent – an average price for electricity. Applying the concept of Levelized Cost of Energy (LCOE) in comparing a gas ‘peaker’ to a solar installation predicts that from 2011 to 2016 the cost per Kilowatt-hour for natural gas will increase from R1.60 to R1.70 while the cost of solar will decrease from an already cheaper R1.00 to 60 cents.

Solar is even cheaper than new nuclear when PV cost reductions are calculated for equivalent generating plants and taking into account the rising costs of nuclear manufacture and installation, over a 13 year build period, versus a two year period for a solar facility. Given that shale gas drillers make much of South Africa’s urgent energy needs, they will be hard pressed to explain the disadvantages of going the renewable route.

The worn-out rhetoric that ‘solar is too expensive’ doesn’t hold up anymore. Despite the trite promises from Shell about making the Karoo a global example, we are skeptical that they can deliver – especially when their international reputation as a polluter is considered. When the documented environmental record presented by shale gas mining is added to the equation, there is a strong argument to seriously investigate renewables in South Africa right now, rather than perpetuating our dependence on fossil fuels. South Africa cannot afford to licence this process unless it has adequately investigated the alternatives and proved that shale gas is the sustainable answer – and a legacy that we would all be happy to leave to future generations.