Public enterprises minister Pravin Gordhan and electricity minister Kgosientsho Ramokgopa appear to have different views on what to do with Eskom’s ageing coal-fired power plants.
If comments made by Gordhan in late March are anything to go by, robust debate is pending between the two ministers when Ramokgopa presents the cabinet with the findings of his visit to Eskom’s 15 power stations and with options on how to deal with their problems. He said at a media briefing last week that the presentation would probably be made this month.
Ramokgopa believes that the ageing power stations need investment to refurbish them to improve their performance and prolong their lifespans. This will require investment by the fiscus and/or the private sector.
Ramokgopa has not yet calculated the amount required for the investment and the extent of the refurbishments but is to present an estimate to the cabinet.
Lifespans
He has questioned the wisdom of shutting down old power stations at the current rate rather than refurbishing them to extend their lifespans because closure would mean removing badly needed megawatts from the grid with nothing to replace them. This would worsen the load-shedding crisis, which is crippling the economy.
Ramokgopa insists that SA will continue to need coal-fired power stations to ensure the baseload of energy that renewables, though essential, cannot provide.
On the other hand, Gordhan believes it would be wiser to invest limited capital in new generating capacity from renewables.
In a recent reply to a parliamentary question, Gordhan said a full retrofit and refurbishment of SA’s coal-fired fleet of power stations to meet emissions standards will cost about R400bn.
“The Eskom just energy transition strategy recognises the financial prudence of investing limited capital budgets towards establishing new generating capacity from renewables, rather than investing in aged coal plants to extend their lives or to make them environmentally compliant. Many coal plants are noncompliant with national minimum emissions standards requirements,” Gordhan said in reply to a question by EFF MP Omphile Maotwe.
“Life-extension retrofits would take, at minimum, two years to complete, while flue gas desulphurisation [FGD] retrofits take up to seven years to complete. Such work would reduce supply and thus exacerbate the supply deficit now causing load-shedding in SA,” Gordhan said.
Exemptions
Investment in wind and solar photovoltaic generation plants represents “the lowest-cost and most expeditious option to address the capacity shortage”, the minister said.
Ramokgopa raised the possibility of exemptions being given to noncompliant power stations for meeting their emissions targets provided they committed to a long-term plan to fall within legal requirements over time.
Also necessary, Ramokgopa said, is a rethink of the aggressiveness of the pace at which SA is to achieve its nationally determined contributions to a net-zero level of emissions so as not to inflict harm on the economy.
Among the many problems afflicting Eskom that Ramokgopa said he had identified during his tour of the power stations was the low staff morale, particularly at those plants earmarked for decommissioning.
Shutdown
According to another recent written reply by Gordhan to a parliamentary question, the following power stations are scheduled for shutdown in the next decade: Arnot (first unit in 2026, last unit in 2029); Camden (first unit 2023, last unit 2025); Grootvlei (first unit 2019, last unit 2027); Kriel (first unit 2026, last unit 2030) and Hendrina (first unit shut down to reserve storage in 2018, last unit in 2025).
The prospect of unit closures and job insecurity has lowered staff morale, Ramokgopa said as personnel did not see a future for them at Eskom anymore.
These “people issues” have nothing to do with the leadership, he said. In this context “there is no additional incentive for people to apply themselves”, the minister noted.
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