Load-shedding a reality until 2023, says former Eskom adviser

2nd June 2015

By: Natasha Odendaal

Creamer Media Senior Deputy Editor

  

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South Africa’s rotational load-shedding would likely extend until 2023 as strained State-owned Eskom battled several challenges that could potentially sink the power utility in five years if left unchecked, Blom Consulting and Training mining and energy advisory partner Ted Blom claimed on Tuesday.

Addressing delegates at the National Civil Society Conference, in Booysens, Johannesburg, the outspoken former Eskom adviser said the utility faced cliffs of maintenance, coal, rail and power-generating shortfalls, in addition to runaway electricity tariffs, contractor claims and impending water shortages.

“It’s not a pretty picture,” he said of the situation Eskom found itself in, adding that any other enterprise would battle to survive with just one of the problems the utility had been hit with.

“Eskom will not survive the next five years in its current state.”

He indicated that the “only way to sort this mess out” would be the implementation of recommendations of an independent judicial review extending back to 1994, when Eskom was the “cheapest, most well run” entity in South Africa.

Now, however, Eskom would likely start running out of coal this year, with the constraints intensifying each year until 2020, when it could possibly see a 60-million to 100-million-ton-a-year shortfall of coal needed for its coal-fired power stations.

Parliament earlier admitted that Eskom faced a 17-million-ton-a-year coal cliff by 2017.

Further, it was unlikely that Eskom could meet government’s ambitions of electricity generation capacity of 70 000 MW – double the current capacity – by 2030.

Without the funds, skills and experience, the utility would not be able to embark on a build programme that would see six more power stations erected simultaneously in the next 15 years, Blom noted, citing the utility’s construction of only two still-to-be-completed power stations and the addition of 8 000 MW to the national grid over the past six years at ten times the cost it should have been.

The cost of the construction of the much-delayed Medupi power station would surpass the R300-billion mark on completion – a considerable jump from the initial R32-billion tabled at concept – with R250-billion already injected into the project, he said.

Eskom’s Kusile power station was likely to cost even more.

Blom also criticised the group’s R14-billion-a-year maintenance programmes, which had fallen behind since 2010, and questioned what the aggregate R70-billion maintenance fund had been spent on, along with the excess revenue Eskom had generated through a 2 300% hike in electricity tariffs over 20 years, from 4.5c/kWh in 1994 to the current R1.20/kWh.

Meanwhile, Blom believed Eskom would face difficulties in sourcing the significant amount of water needed to operate its power stations over their lifetimes in a water-scarce country.

Medupi would require about 90-million cubic litres a year of water.

Limited rail capacity would also end up short-changing Eskom as it spent millions of rands transporting its required coal each day by truck, which was not sustainable.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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