Mineral resources & energy minister Gwede Mantashe says the Komati coal power station decommissioned in October should not have been shut as it provided more power from coal than it will with its planned solar plant.
Mantashe, answering questions in parliament about Eskom, said that in the ’80s three coal power stations including Komati were mothballed and restarted with success.
“So, if the power station has to come to an end, it can be decommissioned, but if the life can be extended it should be extended.”
The Komati power station’s last unit in Mpumalanga was closed in October 2022. Its other eight units had already been shut down due to age. According to Eskom, when it was mothballed Komati was providing only 121MW of electricity.
Mantashe said Komati had produced more than 1,000MW with coal while the solar plant planned there would produce only 200MW.
Komati is to be repurposed to provide 220MW of renewables capacity relying on solar and battery power.
Eskom has earmarked Komati as its model of its just energy transition (JET) strategy, which places equal importance on the “transition to lower carbon technologies”.
Mantashe’s support for the extension of SA’s ageing coal stations, follows recent reports that the proposal to ease load-shedding presented to the cabinet by electricity minister Kgosientsho Ramokgopa included “a relook at the shutdown schedule of Eskom’s coal power plants”.
While the government continues to show support for coal- generated power, experts have warned it could threaten funding from international partners for the JET.
The decommissioning and repurposing of coal-fired power stations is consistent with the country’s Integrated Resource Plan (IRP 2019), and are also key elements of SA’s international climate change commitments.
The Just Energy Transition Partnership (JETP) between SA and its international partner group — France, Germany, the UK, US and EU — is almost exclusively targeted towards decarbonisation in SA’s energy sector as set out in the IRP 2019.
About $2.5bn of the $8.5bn JETP funds will come from the multilateral climate finance institution Climate Investment Funds (CIF) in the form of $500m in grant and concessional loan financing that will be leveraged to obtain a further $2bn in concessional loans.
Mantashe also said that Petro SA, the state-owned oil company, had issued a tender for a partner to help it recommission its Mossel Bay refinery, which was shut down in 2020.
He said the refinery needed extra financial and technical capacity to resume the production of petrol and diesel. The tender process is expected to take 18 months.
SA imports all petrol and diesel fuels as state and private refineries have now been shut down. Mantashe said the refinery would resume production to aid SA’s energy security after it found a partner.
Meanwhile, finance minister Enoch Godongwana said in reply to a separate question that he and the National Treasury supported the recent tariff increase announced by the National Energy Regulator of SA (Nersa).
He said the tariff increase was an attempt by Nersa to give Eskom cost-reflective tariffs.
Nersa approved a tariff increase of 18.65% for 2023/24 and 12.7% for 2024/25.
The minister was asked by ANC MP Maidi Mabiletsa whether the Treasury had engaged with Nersa on the proposed 15.1% hike for municipal customers from July 1.
Godongwana said the Treasury had engaged with Nersa on the municipal tariff increase as required by the law and Nersa was also required to elicit comments from the SA Local Government Association.
The minister said in dealing with Eskom debt — in the February budget he announced a R254bn debt relief package over three years for the power utility — the government had to ensure that Eskom becomes viable. He was conscious of the effect of the tariff increase on the economy, but looked at the issue with the aim of survival of the institution. The Treasury had to protect fiscal sustainability.
“I am taking a quantum leap in dealing with Eskom debt,” he said.
Godongwana said the funding model of municipalities, which rely on the sale of electricity as a source of revenue, was under threat. A discussion was needed on the future sustainability of municipalities and their sources of revenue. With Denene Erasmus
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