State-owned power utility Eskom has deferred to 2022 the deadline for migrating its transmission network to the full redundancy stipulated in the South African Grid Code from an initial target date of 2016. However, it still insists that it will be in a position to connect new Eskom and independent power producer (IPP) generation capacity.

CEO Brian Molefe indicated that transmission-related capital expenditure (capex) had been scaled back or re-phased mainly as a result of the utility’s R280-billion funding gap. However, it had also experienced delays in securing the necessary servitudes for some lines.

He told stakeholders attending the release of the Transmission Development Plan (TDP) for 2016 to 2025 that the group was working on various strategies to address the funding problem, but that resolution would take time.

The TDP 2016 to 2025 anticipated capital expenditure of R213-billion over the ten-year period, including R151-billion for expansion projects. However, the liquidity position of Eskom could affect actual expenditure levels, with the utility planning to spend R6-billion-a-year on transmission projects until its 2017/18 financial year.

“We have made some adjustments to the TDP, including re-phasing of the capital investment in transmission projects, to align with the current available funding,” Molefe said.

For this reason, it would take seven years for Eskom to meet the N-1 reliability and redundancy demanded in the grid code approved by the National Energy Regulator of South Africa (Nersa).

“Although I am currently working to ensure that we are able to close this funding gap and am optimistic regarding the availability of funds, I am conscious of the time it takes to turn the tide.”

The group would still deploy nearly 10 000 km of high-voltage transmission lines over the ten-year horizon and would also be investing in 75 395 MVA of additional transformation capacity by 2025.

“The investment in transmission is R6-billion of the R55-billion earmarked for the current financial year.”

Eskom executive for transmission and sustainability Thava Govender said that Eskom also remained committed to connecting new Eskom and IPP capacity, while admitting that the financial constraints faced by Eskom could mean that IPP projects outside of areas of grid strength would pose difficulties.

Since 2011, 42 renewable-energy projects with a combined capacity of 2 142 MW had been connected by Eskom, which had also invested R2.4-billion to facilitate those connections, which had arisen from the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).

However, Eskom was currently not issuing grid-connection budget quotes for renewables projects participating in the REIPPPP auctions launched subsequent to the third bid window, owing to its financial predicament.

Govender said it was currently in talks with Nersa in a bid to secure an assurance that it would be allowed to pass through costs arising from those projects.

“We hope to resolve the issue in the next week or so and begin to issue budget quotes.”