3 more years of load shedding: Zuma

President Jacob Zuma says that load shedding is likely to last for three more years, after government completed a medium term outlook model for the supply and demand of electricity in the country.

In his response to the 2015 Presidency Budget Vote debate on Tuesday, Zuma said: “the model indicates that demand will exceed supply for the next 24 to 36 months. To increase supply, Eskom is implementing a structured planned maintenance programme to ensure that the availability of all power stations is improved.”

The president stressed that Eskom added 160 thousand households to the electricity grid in the past financial year, which added to the demand of electricity.

“Looking ahead, the Minister of Public Enterprises, Ms Lynne Brown, has tasked Eskom to accelerate the completion of the build programme. The Minister has also directed the utility to improve its project management and contracting in order to increase the generation capacity of the existing fleet,” Zuma said.

Nuclear power

South Africa will have six new nuclear power plants by 2030, which will cost between R400 billion and R1 trillion to build, according to a report by Reuters.

Energy Minister Tina Joemat-Pettersson told Parliament on 19 May that South Africa will start the nuclear build programme in 2015, in a bid to generate an additional 9,600MW of electricity.

Zuma told Parliament on Tuesday that the energy department is  focused on implementing the other four key components of the government Five-Point Plan to address the electricity challenge.

“The role of this department is to ensure that there is sufficient, reliable and consistent supply to meet the growing demand. The Department of Energy has a programme to procure additional supply using Independent Power Producers. The additional supply will come from coal, renewables, cogeneration and also gas to power.

“The gas to power initiative offers a new investment in the economy as significant infrastructure will have to be installed,” Zuma said.

Privatise?

The government will decide on whether to partially privatise state-owned power utility Eskom or whether to sell some of its assets to help fund the electricity crisis.

Citing Treasury, Reuters reported that Eskom would still remain in control of the company, however, government would look into amending regulations to allow private firms to generate their own electricity and sell any surplus to the national grid.

“Given Eskom’s constrained balance sheet and government’s constrained fiscal position, there is a need to explore all options,” the Treasury said in a statement.

“Consideration is being given to ring-fencing and selling stakes in Eskom’s non-core businesses or power stations as well as into Eskom’s business as a whole.”

An additional plan under discussion would be to increase private generation by independent producers.

Last week, The National Energy Regulator (Nersa) announced that it had received Eskom’s application for the re-opening of tariff negotiations for 2015-16.

Nersa will only make a decision whether it will authorise Eskom’s application to hike tariffs by 25.3% on June 29, 2015.

Eskom needs R32.9 billion to supplement its generation capacity with open-cycle gas turbines and R19.9 billion for its short-term power-purchasing programme and the impact of the increase in environmental levy, Nersa said.

More on Eskom

Eskom price hike decision in June

Privatise Eskom says DA, No says ANC

Load shedding to last 3 more years

SA’s R1 trillion nuclear power plans

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3 more years of load shedding: Zuma