Eskom, South Africa’s state-owned power utility, has successfully conducted a pilot of virtual wheeling, a new approach that enables companies with multiple dispersed energy consumption sites to connect to generators via Eskom or municipal grids.
Eskom’s Virtual Wheeling: Simplifying Energy Access – Here’s How It Works
This initiative plays a crucial role in the efficient integration of renewable energy sources into the grid, marking a significant shift in South Africa’s energy landscape.
Traditional Wheeling vs. Virtual Wheeling
Traditionally, wheeling arrangements were established between larger electricity generators and consumers connected at medium and high voltages.
This model was tailored for larger consumers but posed challenges when dealing with numerous low- to medium-voltage consumers. Additionally, many municipalities lacked the necessary protocols and infrastructure for such arrangements.
Recognizing these limitations, Eskom introduced the concept of virtual wheeling, which facilitates energy delivery from generators to consumers with multiple smaller and low- to medium-voltage loads scattered across different regions.
This innovative approach streamlines the process by aggregating energy generation and consumption data across various consumer sites.
Key Differences in Virtual Wheeling
- Billing and Refunds: In virtual wheeling, consumers settle their Eskom bills in full, and a single monthly refund is processed to one account. This consolidation of billing simplifies the process for consumers with multiple sites.
- Data Aggregation: Unlike traditional wheeling, which aggregated energy data on a monthly basis, virtual wheeling allows for hourly data aggregation, including standard, peak, and off-peak periods. This fine-grained data enables more precise calculations and refunds.
- Agreements: Buyers engaging in virtual wheeling need to establish specific agreements, including a virtual wheeling agreement and a back-to-back virtual wheeling platform agreement with a certified platform vendor.
Requirements for Buyers
Buyers adopting virtual wheeling must meet several requirements, including establishing meter access with generators, linking meters to Eskom’s meter vendor cloud, conducting pre-production verification testing, and producing reports aligned with contracted business rules.
Implementation Status and Considerations
Eskom successfully concluded its first Virtual Wheeling Agreement with Vodacom in August 2023 after a successful pilot phase.
However, the full rollout of virtual wheeling involves addressing issues related to municipal wheeling structures, the status of buyers and municipalities in debt to Eskom, and tariff and use-of-system charges.
Benefits and Impact
The introduction of virtual wheeling expands access to renewable energy sources for buyers with multiple dispersed sites, while independent power producers gain opportunities to sell surplus energy.
This initiative has the potential to boost additional grid capacity and accelerate the adoption of alternative energy sources.
Eskom’s virtual wheeling initiative represents a significant step toward enhancing the accessibility of renewable energy and streamlining energy transactions for consumers with multiple dispersed sites.
It aligns with South Africa’s transition to a cleaner energy future and addresses challenges posed by traditional wheeling arrangements.