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Africa|Coal|Energy|Eskom|Financial|Power|Reinforcing|Maintenance|Environmental
Africa|Coal|Energy|Eskom|Financial|Power|Reinforcing|Maintenance|Environmental
africa|coal|energy|eskom|financial|power|reinforcing|maintenance|environmental

Dimming the light

21st April 2023

By: Terence Creamer

Creamer Media Editor

     

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There was so much to be concerned about after the first formal report back by South Africa’s newly appointed Minister of Electricity earlier this month that it is difficult to know where to begin.

Held at the Union Buildings following Dr Kgosientsho Ramokgopa’s two-week tour of 15 Eskom power stations, the nearly two-hour briefing contradicted several Cabinet-approved policies and positions, including those that deal with fiscal, energy and environmental policy.

The “options” of extending the life of coal stations and of seeking yet more exemptions for the highly polluting plant also contradicted government’s international relations stance, specifically in regard to the $8.5-billion Just Energy Transition Partnership – one which has already been imperilled more than once by some highly reckless comments by the Energy Minister, as well as constraints placed on Eskom’s ability to raise new debt for the grid.

For the purposes of this commentary, however, my focus is on the disquieting disconnect between the possible future options that Ramokgopa plans to place before Cabinet and the very programme that the Minister has been appointed to explicitly implement: the Energy Action Plan (EAP).

The EAP, which has been widely consulted, is built on two pillars.

Firstly, improving the dismal operating performance of Eskom’s coal-fired power stations primarily through dedicated and streamlined maintenance interventions, as well as through actions designed to address the corruption, sabotage and skills deficits that are seriously amplifying their poor performance.

And secondly, to add as much non-Eskom generation capacity as quickly as possible so as to create the generation headroom required for the much-needed maintenance of the coal fleet, while simultaneously reducing the frequency and intensity of loadshedding. This second pillar is also largely about laying the basis for a restructured electricity supply industry that shifts away from the current risks associated with over-concentration and South Africa’s extreme carbon intensity.

In other words, the two pillars are meant to be mutually reinforcing. Prioritising one pillar over the other would require an entire reworking of the EAP, which would be highly disruptive, given that it’s been the plan since July 25 last year.

That’s not to say the EAP is not changeable, it most certainly can be changed. But then priority should be given to those elements of the plan that carry the least potential for long-term regret, which is most definitely not the Eskom component.

By contrast, the second leg can not only be funded but is attracting concessional funding. It can also be built by multiple actors, none of which are facing the same financial, credibility, corruption and skills constraints that are currently weighing down Eskom.

Ahead of Ramokgopa’s briefing, the levels of frustration over loadshedding were tremendously high and they still are. Nevertheless, a degree of certainty had also emerged about the approach that should be taken to tackle what has rightfully been declared as the biggest threat to South Africa’s growth, development and job creation prospects, as well as to social cohesion.

What little light there was has been worryingly dimmed.

Edited by Terence Creamer
Creamer Media Editor

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