Independent power producers catch a break
In 2008 cabinet accepted that the use of coal as a power source would decline from 2030 onwards, and in 2011/12 the energy minister and the National Energy Regulator of South Africa (Nersa) determined that electricity generated from renewable energy sources – wind, concentrated solar power, solar photovoltaic, biogas and so on – could be procured through a tender process.
This led to Eskom signing power purchase agreements (PPAs) – with all but three of the independent power producers (IPPs) whose applications were successful – in 2018.
The government’s energy policy had in fact been developed over nearly two decades of extensive public participation and stakeholder involvement. While South Africa has large coal reserves and coal will remain the primary source of energy for the foreseeable future, it has negative consequences such as the emission of greenhouse gases, leading to an energy policy that “supports and promotes the development of renewable energy to achieve a more sustainable energy mix”. The Integrated Resource Plan 2010-2030 (IRP) was established to give effect to national policy within the framework of the government’s electricity policy framework, including the establishment and procurement of new generation capacity.
SMMEs Meltdowns Continue Because Of Eskom Power Cuts
Small medium and micro enterprises (SMMEs) that are feeling the strain from Eskom’s load-shedding are appealing to the South African government to come up with a solution, because they are forced to shut their doors.
South Africa has been experiencing stage 4 load-shedding from the beginning of March. As a result, power cuts are forcing small businesses to shut their doors as swiping facilities and security cameras do not function.
Johannesburg based Gim Bekele, who owns a clothing store in Randburg, says they are losing a significant number of customers as a result of load-shedding.
“When there is load-shedding we are forced to closed the shop because people can’t come in when it is dark. The cameras are not working as well as the cashier machines,” he says.
Kelvin Power Station a way to bypass Eskom – Solly Msimanga
Today, I visited the Kelvin Power Station in Kempton Park, Ekurhuleni. This power station is privately owned and is currently providing electricity to some of the municipalities in Gauteng, despite Eskom’s rolling blackouts.
The current energy crisis, according to Minister Gordhan, will take up to two years to ‘fix’, despite government not having a clear picture of what the problems are, nor how to solve them. All this while our province’s businesses are being crippled, hospitals are unable to provide critical services and crime soars!
We have to take our ‘power’ back. We need to start thinking of ways of bypassing Eskom so as to make sure that the residents of this province have a reliable source of electricity.
Eskom’s fibre could provide revenue and uplift communities
Eskom, which is going to cost the government R150bn over the next decade, is cited as the single-biggest threat to SA’s fortunes. However, with some creativity the power utility could take fast internet to the masses. It is sitting on a fibre gold mine.
While the public has every right to be angry and demand accountability for the malaise of the state-owned enterprise as it directly affects all our fortunes, there is an opportunity that simply cannot be ignored. As the discussions focus on the utility’s unbundling and turnaround strategy, it would be useful for all stakeholders, from the president and public enterprises ministry to the decision-makers at Eskom, to consider a different revenue stream.
Western Cape wants to ‘break free from Eskom energy stranglehold’ – Maimane
DA leader Mmusi Maimane says he will be writing to Energy Minister Jeff Radebe to grant the Western Cape a licence to start importing liquid natural gas (LNG) to run turbine generators in the province.
Maimane says LNG is both a cheaper and cleaner source of energy than having substations run on diesel.
Maimane and Western Cape premier candidate for the DA Alan Winde were speaking outside the Eskom Ankerlig power station in Atlantis, Cape Town, on Wednesday.
“We already have a special economic zone (SEZ) in Saldanha Bay (in the West Coast District Municipality in the Western Cape) that we could import gas through easily and in a sustainable manner, and it comes with a much lower price tag than diesel. We have done the studies and have worked with Transnet on an actionable plan for importation through Saldanha,” said Maimane.
Load shedding: One of Eskom’s newest multi-billion rand power plants is defective
One of South Africa’s newest power plants, designed to supply the grid during peak-use periods, is defective and has been limited to operate at lower capacity.
The deepest power cuts in more than a decade imposed by cash-strapped, state-owned Eskom this month reduced the chances of the continent’s most-industrialised economy posting a stronger recovery from last year’s recession.
Eskom is battling to meet demand and is considered one of the country’s biggest risks.
The Ingula pumped-storage project, a hydropower plant, was completed two years ago as part of the government’s program to boost generation capacity, was designed to provide at least 1 332 megawatts during periods of peak demand.
Kintetsu Railway in Japan installs 42 Tesla Powerpacks as backup electricity
On Wednesday, Tesla announced that it had installed a bank of 42 Powerpacks at a train station in Osaka to service the Kintetsu Railway during the summer or in the event of an emergency.
The electric railway encompasses 311 miles of trackpowered by overhead lines and third rails. In its “disaster preparedness” capacity, the Tesla batteries will provide emergency backup power in the event of a blackout, providing a short burst of electricity to move any trains that might be stalled in tunnels or under bridges to safety.
The system is small—it has a little more than 7 megawatt-hours (MWh) of capacity and delivers 4.2 megawatts (MW) of power at one time. That’s enough to power stranded trains on Kintetsu’s track for just under a half an hour in an emergency.
How business subsidises other electricity users
Businesses and large electricity users can no longer afford to pay up to 18% more for electricity to subsidise Eskom’s poor residential customers, according to the Energy Intensive User Group (EIUG).
The obligation to provide a social package is on government, not business, and it should be done from the fiscus, says the lobby group. The EIUG represents mines, large factories and foundries. Its members collectively use 40% of the country’s electricity supply.
Energy regulator Nersa recently granted Eskom annual tariff increases of 9.41%, 8.1% and 5.22% for the next three years. The first increase will kick in on April 1 for Eskom’s direct clients, who will pay on average almost 14% more for electricity from that date, due to an additional 4.4% increase granted to Eskom earlier in terms of the Regulatory Clearing Account (RCA) mechanism.
Nersa to begin hearings on electricity tariffs
The National Energy Regulator of SA, which sets prices and tariffs for power utility Eskom, will on Monday start a series of nationwide public hearings on what South Africans will be paying for electricity.
Over the course of three weeks, Nersa will hold hearings on what the debt-laden power utility will get to charge for electricity in years ahead, and what it can recoup from shortfalls in 2017/18.
The hearings commence on Monday in Cape Town. The energy price regulator will hear from, among others, Eskom chief financial officer Calib Cassim, a representative of the the SA Local Government Association, advisors to the mining and energy industry, and representatives from The Organisation Undoing Tax Abuse (Outa).
The hearings continue in Cape Town on Tuesday, with members of the public set to testify, before moving on to Port Elizabeth in the Eastern Cape.
Hearings will wrap up in Gauteng in late January or early February. The regulator will announce its decision on March 1.
Eskom announced in October 2018 that it has asked Nersa for a 15% tariff increase per year for the three financial years. The regulator has in the past at times not granted the full tariff increases Eskom has asked for.
Eskom said it wants Nersa to allow revenue of R219bn for 2019/20, R252bn for 2020/21 and R291bn for 2021/22. For this to occur, it would need an increase of 15% a year, said Eskom.
Debt and load shedding
The national power utility is about R420bn in debt and has been seeking ways to reduce its liabilities.
In mid-December President Cyril Ramaphosa appointed a task team to advise government on how to resolve the power utility’s operational, structural and financial challenges.
In late 2018, it was forced to implemented load shedding due to a combination of factors including plant breakdowns, urgent plant maintenance, lower-than-expected output from the Medupi and Kusile coal-fired power stations,and damage to the power transmission lines linking South Africa to the Cahora Bassa hydroelectric dam in Mozambique.
Although it was able to keep the lights on over Christmas and New Years due to lower demand from business and industry, Eskom has said that load shedding may again be on the cards in early January.
