Johannesburg - The stand-off between Eskom and the renewable energy industry took a bizarre turn on Wednesday when truckers who supply coal to Eskom staged a protest in Tshwane over fears that increased contribution of renewable energy to the electricity grid would lead to job losses.
The protest was a spillover of the brewing tension between Eskom and the industry over, among others, the cost of renewable energy and the pace at which Eskom is connecting the independent power producers (IPPs) to the national grid.
Eskom said that it was burning 3 million tons less coal due to the uptake of renewable energy, among other factors. It said this was expected to increase to 10 million tons in 2020. Eskom has attributed the reduced usage of coal to energy surplus and the contribution of renewable energy.
Since the start of the renewable energy independent power producer procurement programme (Reippp) in 2001, Eskom had connected 62 renewable energy producers, contributing 4200 megawatts, said Eskom spokesperson Khulu Phasiwe on Wednesday. The programme has so far procured combined generation capacity of 6 376MW.
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Phasiwe said, owing to the additional output, the utility had to reduce its own power production to cater for the IPP power. “As a result, we no longer need to transport a lot of coal. We have told the coal truck companies that there will be additional capacity from the renewables. At a later stage we will also have capacity from gas IPPs,” said Phasiwe.
From 2021, Eskom planned to decommission some of its power stations, he said. These included Komati, Grootvlei and Camden.
Expenditure costs
He said Eskom was committed to connect IPPs into the grid, but would do so “at a pace and scale we can afford”.
Thava Govender, group executive for transmission at Eskom, said on Tuesday that Eskom’s total capital expenditure costs for enabling IPP connections was R3.7 billion for projects in bid windows (bid window one) to (bid window four) of the Reippp.
Govender said the utility was committed to the renewable energy programme and intended to sign power purchase agreements. “This commitment will be carried out within a framework that takes into consideration the scale and pace of the roll-out of IPP procurement programmes, the long-term financial sustainability of Eskom and the value-for-money criteria vis-à-vis whether South Africa’s customer base can afford the current IPP tariffs and their projected trajectory. The uncertainty on the cost recovery mechanism for IPPs’ energy costs remains a key concern to be clarified with Nersa and other relevant stakeholders.”
The SA Renewable Energy Council (Sarec) said the reduced consumption of up to 10 million tons was part of the government’s policy and was consistent with South Africa’s climate change commitment.
Sarec said Eskom had performed a life-extension exercise for the rehabilitation of power stations earmarked for decommissioning. “In fact, Eskom plans to decommission some 27.5 gigawatts of coal-fired plant by 2040 which will result in a total of 12 thermal plants being closed."