Johannesburg - The Medupi power station, in Limpopo, will ultimately cost more and take longer to complete than Eskom says it will, the Free Market Foundation said on Tuesday.
“The true cost of Medupi is likely to be at least R145 billion and not R105bn as Eskom is saying,” the foundation said in a statement.
Eskom has announced that Medupi will deliver its first power in the middle of next year, six months later than anticipated.
However, SA Independent Power Producers (Saipp) chairman Doug Kuni said in the statement that this would probably happen closer to the fourth quarter of 2014.
The SA Wind Energy Association (Sawea) said on Monday that it was ready to step in and provide power to the grid in the short- to medium-term.
“More than 600MW of wind power is currently under construction today, and the bulk will come online before the winter of 2014,” said Sawea chief executive Johan van den Berg.
“Additionally, our members have dozens of projects ready to commence construction within six months, all of which can be commissioned within 18 to 24 months.”
Sawea said providing the wind power would not cost the taxpayer.
“These projects are fully-funded by our members and their financiers, not Eskom or government.
“There is no risk to the South African taxpayer nor to the Eskom rate-payer, as the electricity tariff is fixed for 20 years and it would be the private project company who shoulders the risk in the unlikely event that there are cost overruns or delays.”
Earlier, the Democratic Alliance asked for the contractual agreements between Eskom and companies working on construction of the Medupi to be made available to Parliament's public enterprises portfolio committee.
This would allow MPs to put in place measures which will prevent any further delays at the plant, Democratic Alliance MP Natasha Michael said in a statement.
Michael said that while it was well-known that labour disputes between contractors and workers at Medupi had hampered progress and caused delays, “shoddy production at the plant by some contractors” had added to the crisis.
“These contractors included Alstom, which was responsible for faulty software at the site, and Hitachi Power Africa, which was liable for the faulty welding of boilers....”
She said “stringent penalties” needed to be agreed to and enforced against any company causing further delays.
“The contractors have been allowed to produce substandard work, leading to the delay of the roll-out of the first phase of the project....
“The impact of this delay and its related costs on our economy, especially with the increased likeliness of rolling-blackouts, will be severe.” - Sapa