Mantashe says a ‘second Eskom’ would be established in his department – report

 ·17 Jul 2022

Energy minister Gwede Mantashe says that a new second power generation company would fall under his department and generate electricity alongside Eskom.

He told the Sunday Times that a move to renewables was more “ideological than technical”. Were it not for this ideology, the country would already have Karpowership’s floating power plants up and running, he said.

President Cyril Ramaphosa said earlier in the week that the creation of a new energy-producing system would assist in alleviating the risk posed by the failings of the current system.

“If we look at other countries like China, it has a number of state-owned electricity generating companies that compete amongst themselves to bring prices down,” Ramaphosa said in a speech to a meeting of the South African Communist Party on Friday. “That is a future that we should begin to imagine.”

Mantashe told the media that a second state-owned company would need more power stations to be built. “So what we are suggesting — it’s not a decision yet — is let’s have a second generation company of the state, and that generation company must focus on baseload, and there must be a build programme for power stations,” Mantashe said.

“We can’t allow power stations to only hear decommission, we must also have a build programme, and we think that if Eskom has no capacity, let’s start a second generation company.”

“It will be a generation company because transmission will be an independent company which does wheeling and a marketplace for energy. It is at the centre, it can source energy from anywhere, including the private sector, it can source it and wheel it,” the minister said.

Mantashe said this second company would be established in his department. “All that excites me is that the president begins to talk to me. It means he is warming to the idea, and that to me is a call for me to act with speed,” he said.

New plans for more reliable electricity

Eskom chief executive officer, Andre de Ruyter, said South Africa could see the end of load shedding by the end of next week.

“Towards the end of the coming week, we should emerge from load shedding,” said de Ruyter at a walking tour of the Tutuka power station on Saturday (16 July), accompanied by the president.

“We’ve already lifted our indication for load shedding going forward; we’ve got a couple of big units returning, so that’s positive news,” he said. De Ruyter said Eskom expects load shedding to become less likely by the end of the month as the troubled nuclear plant Koeberg 2 comes back online.

The power station is set to provide a necessary 920 MW to the national grid; however, de Ruyter added that to curb load shedding for good, additional capacity is still required as the system is currently unreliable and unpredictable.

Ramaphosa told journalists that he had met with various managers from different power stations to get further insight into the problems faced. The president, meanwhile, is expected to announce a new plan to build a cleaner and more reliable electricity grid soon.

The Sunday Times reported that the president is considering several key proposals to resolve the country’s energy crisis, including:

  • Increasing the limit for embedded generation (or scrapping it altogether).
  • Providing a temporary exemption from local content requirements for constructing new energy projects.
  • Doing away with or relaxing Nersa registration processes to fast-track new renewable energy projects.
  • Streamlining environmental and water approval processes for new renewable energy projects.
  • Subsidising households and businesses to install roof solar panels and sell excess power to the grid.

These proposals have primarily come from the National Planning Commission, which has called for the government to prioritise adding 10,000MW of wind and solar power and 5,000MW of battery storage.

“The message is clear: this is no time for business as usual. We need to act boldly to make load-shedding a thing of the past,” said the president.

Read: Load shedding could be over by the end of next week: De Ruyter

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