The new year is off to an uncertain start, with an irregular electricity supply the last problem the domestic economy needs. As most companies returned to full production on Monday on the first day of work for many, Eskom warned that there was a risk of power shortages for the rest of the month.
The power utility said it had started using its emergency reserves to meet the escalating power demand. Eskom spokeswoman Hilary Joffe said some power generating units had tripped and others were not performing well.
“The system has been very volatile. There are issues with (wet) coal at some stations because of rain. Others are unable to perform at very high temperatures,” Joffe said.
The utility held meetings on Monday with its large customers, including municipalities, asking them to decrease power use and switch off as many appliances as possible.
Joffe said on Monday had been a tough day and Eskom expected the rest of the week, if not the whole month, to be equally challenging.
She said the utility was, however, not warning of load shedding for now and would do its utmost not to resort to this.
“We are not saying we are about to do it now, but we are warning that the risk is there if the demand does not go down. We are pleading to everyone to switch off. We are running on emergency reserves and it’s not even peak time yet,” she said.
To bridge the gap on Monday, Eskom began using the open-cycle gas turbines in the Western Cape, which Joffe said were extremely expensive to run.
It also activated its pump storage scheme and used all the power available from independent power producers.
Joffe said some of Eskom’s large customers had been helpful in trying to stabilise demand. Eskom implemented its agreement with BHP Billiton to cut off its KwaZulu-Natal aluminium smelter.
The utility said all households and businesses needed to cut their power use by 5 percent to stabilise the system.
Cornelis van der Waal, the electricity analyst programme manager at Frost & Sullivan, said the threat of load shedding had been imminent for some time, and some businesses that had special arrangements with Eskom had been enduring load shedding for months.
“The problem stems from 1998 when the government refused to invest in new power generation. It doesn’t come as a surprise. We all knew that the system has been constrained for some time now,” he said.
Van der Waal said there would be an impact on the economy but it could not be determined as the extent of possible load shedding was not known.
Tony Twine, a senior economist at Econometrix, said the implications of Eskom’s warnings were difficult to assess at this stage because load shedding remained a risk rather than a reality.
Twine said it was likely that Eskom did not yet know the probability of load shedding occurring as it depended on future demand as well as supply.
“I don’t believe there can be (load shedding). In a threat you need to know the outcome and the probability of the outcome. The outcome is still unknown. We don’t know if it would be local or regional,” he said.
Eskom regularly runs maintenance on its units during the summer season. Joffe said at the moment, 13 percent of its capacity was allocated for this scheduled maintenance.
Last year the utility warned of possible power constraints until the commissioning of the first unit of the Medupi power station in 2013.
Eskom chief executive Brian Dames, in his last state of energy update in November, said the risk in summer was that there was not the capacity to meet demand, because it might not have enough reserves during the maintenance season. This usually starts in September and ends in May.
In the past, Dames has said that Eskom’s power plants were aging and required more maintenance to improve reliability.
Eskom’s warning comes just weeks after the utility posted a stellar profit, which it attributed to big tariff increases.
But Gary van Staden, an analyst at NKC, said although the parastatal made a large profit, it could not reinvest this in a few months.
“If they don’t have a clear plan on what to do to reinvest that profit to increase power capacity, then that would be the problem. But certainly this is not good news for the ordinary consumer,” he said.
The Cape Chamber of Commerce said while it appreciated the fact that Eskom had contacted it, the chamber was not happy with the lack of information provided.
“Basic scenario planning should be in place. For the country’s power supply to possibly be prejudiced in this way, at this time, and this economic climate, is just not acceptable,” said Michael Bagraim, the president of the chamber. - Business Report