Eskom signs new agreement with the Netherlands to help in the move away from coal

 ·21 Jun 2023

Eskom and the Netherlands have signed a letter of intent (LOI) to further the power utility’s move away from coal.

The new agreement will boost collaboration on the ‘Just’ initiative, which Eskom said will enable job creation, drive economic growth and assist power stations in transitioning from coal generation into a renewable energy hub.

The latest LOI specifically provides for the repurposing of the Grootvlei Power Station as the site transitions.

“This marks a milestone in South Africa’s transition away from coal reliance,” Eskom said.

The utility said that the collaboration with the Netherlands will also develop other opportunities to create jobs by training and upskilling people from local communities.

“The LOI also intends to create a market in the region for profitable, productive and sustainable and climate-smart farming as well as new enterprises,” it said.

A similar approach of repowering and repurposing other existing coal plants will also take place, such as some of the oldest coal plants in Mpumalanga.

“The coal plants will be depowered by leveraging the existing infrastructure to build new generation capacity including solar, wind, batteries and synchronous condensers.”

The partnership forms part of the Just Energy Transition Plan (JETP), which must consider the social impact on surrounding communities, namely, the potential impacts on jobs and local economies.

“Eskom believes that, as it transitions to cleaner sources of power, it must do so in a responsible manner that considers all impacts and stakeholders, including coal mining communities, that will be impacted by the transition.”

“Eskom will continue to undertake socio-economic studies to understand the impact of the closure of the coal plants and how to mitigate its impact.”

The power company said the coal plants could also be repurposed into new “centres of economic activity” such as training centres, water treatment facilities, manufacturing plants, microgrid assemblies and modern farms.

Eskom said it would explore multiple avenues to ensure system stability and manage the security of supply, including repowering transitioning coal power stations with renewable energy and continuing to operate power stations beyond their traditional shutdown dates where practical and legal.

Under the JETP, rich countries such as the Netherlands have committed $8.5 billion in conditional loans to assist South Africa in its shift towards renewable energy.

To achieve this transition, Eskom plans to replace most of its remaining 14 coal plants with renewable energy sources like wind and solar power.

While the government, and the energy department in particular, has not walked back on these plans, it has been suggested that they be delayed or approached more slowly to give South Africa more breathing room in dealing with its prevailing energy crisis.

Read: Netherlands and Denmark eye new energy ‘gold rush’ in South Africa

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