Why are you still with Eskom?

Liquified Natural Gas (LNG) is a viable alternative with a strong history in power generation – just ask 42 countries! 

There is no reason to persevere with load shedding while the industry “waits” for renewable energy. Like deer in the headlights, South Africa has kept its focus on Eskom-driven solutions, when, for many years alternatives have existed. Renewable supporters can start the transitional process now by using LNG for peaking and or mid-merit power generation, vehicular and furnace fuels. LNG is well supported globally and poised to be the next wonder kid in Africa after all, Africa holds 9% of the world’s natural gas reserves! 

There is no question that 100% dependency on renewables is the end game for South Africa. However, shifting from coal to renewables without using an energy mix through the transitional period is like jumping from a bicycle to a superbike. The setup costs are significant, and renewables are new fodder in a market that has been in existence for decades. While LNG has a track record, there are simply no proven statistics around reliance on supply when it comes to purely using renewables in a Southern African context. 

What are your business needs when it comes to an energy mix?

There are significant drawbacks to relying solely on one transitional energy source. Consider how weather conditions and daylight hours impact a solar energy system’s power generation ability. To combat this, transitional energy such as LNG can run as a complementary source to solar which creates a hybrid solution that can stabilise and improve energy output. Utilising LNG as an alternative to heavy carbon-based fuels can mean escaping load shedding, less taxation and reducing carbon emissions. In terms of pricing, LNG can be contracted on a mid-to-long term basis minimising exposure to major price fluctuations.

LNG is an ideal power generator to use in an energy mix. LNG has an annual production capacity of 487 million tons a year and robust global trade which includes Southern Africa. Localised supplier, LNG Hub, offers contracted LNG supply which guarantees affordable pricing. 

LNG has a long track record and is being globally utilised in energy mixes. According to the International Group of Liquefied Natural Gas Importers, 601 LNG tankers are in service worldwide. Their total transport capacity is 86 million cubic meters and growing. Qatar and Australia are leading in LNG production, while USA, Russia, Malaysia and Nigeria are significant players. LNG receiving terminals and regasification plants span 4 continents and are in 42 countries! China, India, South Korea and Japan are the biggest importers of LNG while European importers include The Netherlands, Spain and Italy. 

Mitigating supply risks 

Based on our past and present experiences, any single energy solution poses a higher risk of energy shortages. South Africa has been long dependent on coal with a minimal viable energy mix strategy. It all boils down to an energy mix that works for your business. For example, a mine producing aluminium situated in the Northern Cape has a different energy mix requirement from that of a steel smelter in Gauteng. The need is to lessen the reliance on Eskom by customising your power generation through an energy mix that mitigates risk.

Now is the time to explore LNG as an energy option with contracted supply available. LNG Hub calls on customers to secure agreements for 2024 and 2025 as production with West African supply sources will close soon. 

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