Globally, the British firm currently has a fleet with a capacity of about six gigawatts (GW) and has three power solutions, one of which could deliver 100 megawatts (MW) in Botswana within 90 days. Executives from the Glasgow, Scotland-headquartered firm were last week in Botswana where they held discussions with the BPC and other potential clients. Aggreko plans to set up a Botswana office following the completion of a feasibility study.
“We are in discussions with them (BPC),” said Aggreko’s regional director for Europe, Middle East and Africa operations, David Taylor-Smith in an interview. “We have 1GW of capacity right now in Africa and we have been in the business for over 50 years. We are well placed to implement a very fast tracked short or medium term solution as a bridging solution and move it once the long-term plant is in place.
“We have already identified the fleet that we could use for Botswana.” Aggreko’s proposals come as the country endures the third month of rolling blackouts due mainly to delays in the construction of the 600MW Morupule B power station. The BPC expects peak local demand to increase during winter.Supply sources are precarious with three units at Morupule B still out of action and power being generated locally by emergency diesel power plants.
Imports from Eskom of South Africa and other neighbouring utilities may not be enough to help meet demand.Aggreko’s three power products include a 100MW temporary diesel powered solution, which can be established within 90 days of contract signing, as well as a 50MW cross border power from a generation plant that uses natural gas as the fuel source.
Regionally, the firm already has 232MW contracts to supply Mozambique, South Africa and Namibia, from the firm’s US$200 million gas facility at Ressano Garcia in Mozambique, which took 22 weeks to commission and started generating in July 2012. Aggreko’s third solution is a 100MW heavy fuel oil (HFO) plant, an innovative and interim power generation technology which the firm has developed to support customers with a lower-cost fuel solution compared to diesel.
“The diesel power solution is more expensive, driven by the fuel cost, while gas is about 25 percent cheaper and heavy fuel oil is somewhere in the middle,” said Taylor-Smith.”The fuel cost accounts for 70 percent of the overall cost of the electricity, thus the key is getting generation as close to the fuel supply source as possible, to mitigate high fuel transport costs which arise, if fuel is brought in by trucks.
The regional director said “Aggreko’s 100MW HFO plant, which will be located at the fuel supply source, could save Botswana up to US$25 million per year if it was running 24 hours a day, when compared to diesel. “The plant is being developed next to a sea port, where ships can easily deliver the fuel, rather than in inland where the heavy fuel oil is too costly to transport.” Aggreko executives were also due to meet with other potential customers such as those in the mining sector, as part of its efforts to establish a permanent Botswana office. The British firm has had customers in Botswana for five years, but has been serving these from South Africa. “From the initial market research we have done, the economy has slowed but is still outperforming many around the world and it is still very attractive,” Taylor-Smith said.
“We are currently undertaking a feasibility study and the permanent Aggreko office could be established within a year, which will have its own fleet of generators and associated equipment such as transformers located in country to ensure we can rapidly respond to Botswana customer needs” He added: “Botswana should feel proud of how attractive it is for investment. It is a safe place for foreign companies to come and do business and that cannot be said about everywhere in Africa. “This is reflected in the speed at which we can come here as well as the cost.”
Once established, Taylor-Smith said, Aggreko would adhere to its policy of recruiting 75 percent and above of its staff from citizens, in order to transfer key skills such as electrical engineering.