Bushveld Minerals: A Large-Scale Battery Storage Contender

AIM-listed integrated primary vanadium producer Bushveld Minerals’ energy subsidiary, Bushveld Energy, who is currently proving the viability of its first utility-scale vanadium redox flow battery (VRFB), believes that VRFBs are a front-runner technology for meeting the growing demand in the energy storage sector in Africa, writes CHATELLE KOTZE.

While much of the hype around energy storage has been around lithium-ion batteries, which have a wide array of uses – for powering personal electronic devices to electric vehicles – there is a need for bigger batteries that are able to store much more energy.

The VRFB is emerging as a solution to the challenge faced by the renewable energy generation sector for storing energy – as the energy is not always generated at the same time as peak demand occurs.

This means that VRFBs, which truly excel when storing energy for longer periods of time, such as three hours or more, unlike lithium-ion which prove more economically viable for energy storage over shorter periods of time, can be used to store energy for use at peak load times on conventional energy grids or when the renewable energy system is not producing energy.

For example, this would be when the sun is not shining or the wind is not blowing in the case of solar and wind power, respectively.

There are also many other suitable applications for VRFBs within the transmission and distribution network, mini and smart grids, as well as behind-the-meter applications.

Bushveld Energy’s first energy storage project, which is currently underway, entails the testing of a utility-scale VRFB at state-owned power utility Eskom’s mini-grid located at its Research, Testing and Development (RT&D) Centre in Rosherville, South Africa – allowing Eskom to test the VRFB, its performance and applications under numerous simulations.

The project is the culmination of the co-operation between Bushveld Energy and the Industrial Development Corporation (IDC) of South Africa who together undertook a study in the second half of 2016 to assess African VRFB demand and opportunities.

By August 2017, the study concluded that favourable demand for VRFBs, particularly in the utility (including transmission and distribution networks) and off-grid, as well as mini-grid markets, exist.

The 120 kW peak power and 450 kWh peak energy VRFB, which was manufactured by US-based technology company, UniEnergy Technologies, is in the process of undergoing an 18 month-long testing period to validate the operational performance of the system in local conditions and to demonstrate the applicability of the VRFB for broader commercial use in South Africa and the rest of Africa.

The testing will entail at least six simulations at the RT&D Centre including minimum load shifting, wind generation smoothing, solar generation smoothing, power quality improvement, multiple full daily charge cycles and potentially self-black-start capability.

Speaking at a site visit to Eskom’s RT&D centre earlier this year, Bushveld Energy CEO Mikhail Nikomarov noted that the trial unit is a small solution but proportional in its design to address Eskom’s energy-to-power ratio and size requirements. It is meant to assist the utility with peak shaving by supplying stored energy to the grid during periods of peak energy demand.

Gearing up for bigger battery storage opportunities

Thanks to the learnings provided through the VRFB deployment, Nikomarov believes Bushveld Energy stands in better stead to tender for the utility’s upcoming battery energy storage systems (BESS) project.

Eskom announced the BESS project in October 2018, which entails the large-scale deployment of distributed battery energy storage.

The funding for the BESS project, which is already in place from the World Bank and partner institution, forms part of the multi-billion dollar loan that was provided to Eskom for the Medupi and Kusile coal power station financing.

The loan specifically required that part of the funds to be used for the deployment of renewable energy, and the BESS project is designed to enable Eskom’s power system to absorb more renewable energy.

While Eskom has already spent a portion of this on the establishment of the Sere wind farm and the Ingula pumped hydro storage scheme, it has applied for and been granted permission to deploy the remainder of the funding into battery energy storage.

The project will be implemented in two phases for a total of 1 400 MWh of energy storage capacity – 800 MWh in Phase 1 and an additional 600 MWh in Phase 2.

The request for proposals for the first phase of 800 MWh is expected to be released to the market by mid-2019, with construction, testing and commissioning anticipated before the end of 2019, while the second phase is anticipated in 2020.

According to Nikomarov, there are several benefits for Eskom in using battery storage as part of its energy mix, including energy arbitrage, offsetting the lack of flexibility of baseload power generation (coal and nuclear) by supplementing supply through demand peaks and troughs, for complementing variable wind generation and for storing solar energy for dispatch at peak demand times.

Mojapelo says that should Bushveld Minerals be awarded a portion of the tender, the company plans to deliver on it through a combination of systems that are imported and locally sourced and assembled. The more time that is permitted between order placement and delivery by Eskom, the greater the amount of components that could be sourced from South Africa.

However, in line with Bushveld Minerals’ strategy of becoming one of the world’s largest integrated primary vanadium platform, it is the company’s endgame to vertically grow the business.

It plans to do this through the supply of vanadium electrolyte for VRFBs for the energy storage sector in the medium term, which the company is already actively planning together with the Industrial Development Corporation through the establishment of an electrolyte manufacturing facility in East London.

Through this, it can include South Africa in the global VRFB supply chain with the added benefit of creating a captive market for Bushveld Minerals’ vanadium production.

“What places us in a good position for future growth is that our business strategy of mining and producing our own vanadium at a low cost (the largest and most expensive component in VRFB manufacture accounting for 35% to 40% of the total cost) enables us to participate in the downstream energy market profitably,” Mojapelo concludes.