Page 4 - AfrElec Week 04

AfrElec COMMENTARY AfrElec
SA takes small reform steps, but new laws are needed to save Eskom
Loadshedding has returned to South Africa, but reform talks are beginning to make headway despite a lack of much-needed legislation, writes Richard Lockhart
SOUTH AFRICA
WHAT:
South Africa is set for loadshedding as demand rises
WHY:
Eskom is still reliant on emergency diesel to cover for maintenance problems
WHAT NEXT:
New legislation is needed to kick-start reform and turn government plans into reality
ESKOM again warned of power cuts this week, with 12,683 MW of capacity offline, well above its target unplanned capability loss factor (UCLF) of 9,500 MW and close to the record level of 14,096 MW seen in the first week of January.
The company said that load-shedding had now returned following two weeks of lower demand after the mid-summer holiday period.
Eskom is to implement Stage 2 load-shedding from 21:00 on January 30 to 06:00 on January 31, because it needs to replenish water levels at pumped storage schemes and diesel supplies for open-cycle gas turbines. There had also been delays with maintenance at many coal- fired plants. Local power cuts keep happening in many places, such as Paulshof and Petervale in Gauteng Province, because of local network problems.
Meanwhile, Eskom has taken energy reg- ulator Nersa to court in a bid to raise tariffs to cover some of its costs. Nersa had previously refused to allow Eskom to raise tariffs by as much as 17% from March 2020, and has caused up to ZAR173bn ($1.7bn) in lost revenue. Cur- rent legal action concentrates on 2018-2019, when Eskom asked the regulator for a 19% tariff increase, but only received 5% from Nersa. The
utility claims that it lost ZAR29bn in revenue because of this.
CEO’s views
These latest developments have come about as the government has done little to push forward its unbundling plans for Eskom, while there is little progress in announcing the much-awaited fifth renewables licensing round (REIPP5).
New CEO Andre de Ruyter, brought in as a technocrat after up to 30 people said no, must try to steer a safe course between differing political groupings, attempt to deal with power cuts and push forward change.
This week, he suggested that private equity could help raise ZAR18bn to fund new privately run power plants in South Africa in a bid to pro- vide much needed generating capacity,
“Eskom doesn’t have the balance sheet to build additional capacity and we think that it’s time that we structure the electricity industry in such a way that we encourage private invest- ment, particularly in generation,” he said.
“There is an amount of about ZAR18bn that needs to be invested in order to accommodate the entry of independent power producers (IPPs) into the grid,” he told South African TV.
“Now somebody needs to pay for that and it
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w w w. N E W S B A S E . c o m Week 04 30•January•2020