Eskom needs four more massive power stations: report

New research conducted by the Institute of Race Relations (IRR) says that South Africa, and Eskom in particular, will need to have built the equivalent to four more Kusiles by 2020, to meet power demand.

In a research paper published in @Liberty, the policy bulletin of the IRR, engineer and energy expert, Andrew Kenny said that South Africa will need another 18,000 MW within five years in order to meet demand.

He noted that as electricity demand has outstripped supply, so Eskom has shed its load in four ways -the last being the most damaging:

  • First, it has done deals with industrial customers to shed load. Often it has paid them to do so.
  • Second, it has ordered these customers to shed load under an emergency law.
  • Third, it has at times simply disconnected certain districts and big customers.
  • Fourth, it has let it be known that it is unable to provide sufficient electricity to power new mining and industrial projects or the expansion of existing ones. This warning has prevented much investment in our mines and industry.

Eskom’s inability to meet demand is illustrated by the record of its Open Cycle Gas Turbines (OCGTs), the IRR report said.

“When Eskom finally realised the crisis it was in, it built the quickest power plants it could to meet peak demand. These were gas turbines.”

The power utility built five at Mossel Bay and nine at Atlantis, with a capacity of 150 MW, each, or a combined capacity of 2,100 MW. This is slightly more than Koeberg’s generating capacity of 1,910 MW.

These gas turbines were cheap to build, but they are extremely expensive to run because they use diesel as fuel, the report noted.

Typically, whereas Koeberg’s average selling price is 70 cents/kWh, it costs over R3.20 for a kWh from a gas turbine, Kenny said.

“The idea was that the turbines would be run only for short periods, at times of peak demand. But because of the desperate shortage of available power stations, the gas turbines have had to be run often and for long periods at huge costs”

The fuel costs of running them increased from R5 billion in 2013 to R10.9 billion in 2014.

Eskom now has operative generation capacity of just over 44,000 MW. Its biggest ever supply peak was just under 37,000 MW. But this, of course, was not the biggest ever demand for electricity.

“At a guess, that demand would be in the region of 40,000 MW. A healthy electricity supply system has a ‘reserve margin’ of 15%. This means that Eskom ought now to have generating capacity of 46,000 MW,” Kenny said.

If the local economy grows at 3% a year, with electricity demand growing at the same rate, as it did from 1993 to 2007, by 2030, the country will need generating capacity of 73,000 MW to give us a reserve margin of 15%, the report said.

When Medupi, Kusile and Ingula have all been completed, which should be in about 2020, Kenny said, the country’s capacity will increase to 55,000 MW. “So we will need another 18,000 MW, equivalent to four more Kusiles or eight more Koebergs,” Kenny said.

What makes the problem worse is that many of the country’s coal powered power stations will run out of life by 2030, the report warns. The first big six-unit coal-fired stations were built in the 1970s, with an expected 40-year life. That 40-year life is coming to an end.

“The best way forward is to keep Eskom as a state-owned generator, while allowing any company to compete against it for the generation and sale of electricity – provided this competition is strictly on a commercial basis and is not skewed by subsidies,” Kenny said.

“Eskom must also be depoliticised. It should resume its old function: to provide suffi cient, reliable electricity and to cover its costs. Nothing else.”

He said that electricity distribution should be taken away from municipalities and given to private electrical engineering companies.

For baseload electricity, there are two present options and two possible options in the
future. The present options are coal and nuclear, of which nuclear is the better. The future
options are gas (from the Karoo or Mozambique) and hydroelectricity imported from Central Africa, the research paper said.

For peaking power, the options are gas turbines, and pumped storage. Concentrated
solar power (CSP), with storage, might be a third option, Kenny said.

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Eskom needs four more massive power stations: report