Energy - 08 April 2024

08 Apr 2024

ENERGY

• Three units at Eskom’s Kusile Power Station, which is currently performing exceptionally well, will be taken offline one after the other from October this year to install the permanent solution following damage to their chimneys. The damage deprived electricity users of their combined generation capacity of 2 400MW for most of last year. International experts VGBe, appointed by National Treasury to do a technical assessment of Eskom’s generation fleet, were clear that the damage to the chimneys resulted from Eskom deviating from proper operational and maintenance practices for the FGDs. Unless this is changed and proper skills brought in, the situation may repeat itself and the plant may deteriorate further, which is completely unnecessary, they said. It is unclear whether anybody has been held accountable at Eskom for this incident, which occurred in October 2022. Eskom’s response to questions in this regard was  merely that “management gives the assurance that they are dealing with it internally”. (Source)

• Role of gas in SA’s future energy mix is under intense scrutiny. Given South Africa’s ongoing energy crisis, there remains much debate around whether gas should be included in the future energy mix and, if so, how much. (Source)

• The Integrated Resource Plan (IRP) 2023 should be reworked as it is fundamentally flawed, said the CEO of Business Leadership SA (BLSA), Busisiwe Mavuso. She has expressed concern in the plan’s ability to fix SA’s electricity supply woes. Mavuso said the draft plan, which will be used by the government and Eskom to make decisions about the procurement of new generation capacity and other energy planning matters, was “out of touch” with the country’s energy needs and demands and should be immediately reworked to reflect SA’s energy market, which is dominated by coal. (Source)

• Eskom is not being privatised through reforms to the electricity sector in South Africa. Even after its unbundling, the government will still own 100% of the company’s assets. Chairperson of the utility, Mteto Nyati, told CNBC Africa that the private sector will only be allowed to participate in the grid build-out and electricity generation. It will not take over these functions. The Department of Public Enterprises (DPE) has been promising South Africans for nearly a year that the “new Eskom” – under a new holding company dubbed NewCo – is around the corner. The DPE told Parliament in August last year that it is making good progress in unbundling Eskom into three separate companies, alongside a new holding company to oversee them. (Source)

• Use of paraffin declines. The wholesale price of illuminating paraffin fell 29 cents per litre – a welcome relief for poor South African households that use the fuel for cooking. However, the number of households that rely on paraffin has fallen dramatically over the past three decades, according to census data from 1996 to 2022. In 1996, 21.6% of all households used paraffin as a source of energy for cooking, falling to 8.5% in 2011 and further to 2.7% in 2022. (Source)