Page 12 - AfrElec Week 08

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NEWS IN BRIEF
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in non-fuel power purchase costs by Sh18bn from KES52.7bn to KES70.8bn following the commissioning of two power plants with a combined generation capacity of 360MW during the period,” said Kenya Power.
COAL
Sasolconfirmsitiskeeping coal business
South African petrochemicals group Sasol is keeping its coal mining business, Chief Executive Fleetwood Grobler said on February 24, Reuters reported.
“There was some speculation about the future of our mining business, but I want to clarify mining is a key driver to the integrated coal to liquid value chain and we intend to keep it,” Grobler told a news conference, after Sasol reported a 74% drop in interim profit.
Speculation emerged in September 2019 that Sasol would sell its 40mn tonne per year coal operations as the company grappled with cost overruns and delays at its giant US chemicals project, Lake Charles.
Selling its coal mines would also help Sasol reduce its environmental liabilities at a time when more investors are focusing on how businesses affect climate change, it was said at the time of the speculation.
The news comes as India, the biggest importer of South African coal, plans to end
imports by 2024. Meanwhile, key coal supplier Glencore has announced plans to exit the SA coal market.
GENERATION
De Ruyter: Eskom debt will notsimplydisappear
Eskom’s ZAR450bn debt burden needs to
be addressed – either through an equity injection, a tariff hike or higher sales – but the money must come from somewhere, CEO Andre de Ruyter has said.
The chief executive was among other Eskom officials who briefed the standing committee on public accounts on February 25, about matters relating to the Medupi and Kusile power stations.
The construction of these power stations has been delayed, and there have been cost overruns running into hundreds of billions.
De Ruyter said Eskom took on three mega projects – Medupi, Kusile and Ingula – while tariff increases were capped at consumer inflation. This put the power utility in a position where “inevitably” it had to take on significant debt on its balance sheet. “This debt has been exacerbated by corruption, delays and so forth.
“At some stage, unfortunately, the money has to come from somewhere. Whether it comes from a tariff increase or whether it
comes from an equity injection, it (the debt burden) does not disappear.”
De Ruyter acknowledged that Eskom’s debt burden poses a significant risk to the fiscus. “The issue of Eskom debt has to be addressed in order to make us sustainable,” he said.
Eskom’s debt servicing obligations amount to about R70bn per annum, which is a “huge burden” on Eskom’s income statement, De Ruyter said.
WIND
Egypt begins construction
of Lekela’s 250MW wind
farm
Egyptian Electricity Minister Mohamed Shaker said at the start of construction of Lekela Power’s 250MW West Bakr Wind wind farm that energy reforms had allowed officials to address the crisis of frequent power cuts in Egypt.
He also said that Egypt had built 28GW of new generating capacity in the past five years.
Shaker said that energy was one of the most important means to achieve peoples aspirations towards a better future and the main driver of economic and social development projects in Egypt.
The electricity sector has taken several steps to achieve a complete transformation
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Week 08 27•February•2020