Energy – 19 June 2024

Sustained improvement in the performance of power plants has resulted in Eskom reducing its spending on diesel to run peaking stations by about 78%. During April and May, the first two months of its current financial year, Eskom spent about R5.6bn less on diesel to run open-cycle gas turbines (OCGTs) than over the same period last year, with total spending down from R7.8bn to R2.2bn. Eskom spent more than R30bn on diesel to power the OCGTs in the financial year to end-March 2024, up from R21bn in the previous year and about R10bn in 2022. “To have a comfortable winter with reduced intensity and frequency of load-shedding we had to keep [breakdowns] below 14,000MW. For the last two months, we have averaged 12,000MW. Our generation recovery plan still has some way to go as we focus on improving the unreliability of the fleet, but we are comforted by the results we are seeing to date,” CEO Dan Marokane said. He said that notwithstanding the recent improvement in power station performance, load-shedding remains a risk. (Source)

South Africa’s next electricity crisis, brought about by deteriorating municipal infrastructure, is here and has already begun to impact large parts of Johannesburg. While Eskom has been able to meet this increased demand so far in winter, distribution infrastructure has begun breaking under the load. The reform of South Africa’s electricity sector has accelerated in recent years, with Eskom set to be unbundled into three entities: Generation, Transmission, and Distribution. However, much of this reform has been focused on the Transmission division of Eskom as the legal separation has been completed and it has received licences for it to operate. This will open up the grid to private generators of electricity who can effectively compete with Eskom’s generation division to supply electricity. While this progress is vital to bring load-shedding to a permanent end, very little effort has been made regarding the Distribution division. This area of the electricity sector is largely the responsibility of municipalities and is an important source of revenue for them. (Source)