Eskom has maintained its confidence that wheeling will serve as a catalyst for enabling the private sector to participate in power generation, which will provide the system with the much-needed additional capacity to handle load shedding.
Wheeling is the delivery of energy from a generator to an end-user located in another area through the use of an existing distribution or transmission networks.
As an illustration, consider a solar farm operated by an independent power producer in the Northern Cape that sells its energy to a large corporation in Gauteng. Eskom's transmission network and local distribution networks are used to supply the electricity.
Eskom senior adviser for electricity pricing Onicah Rantwane yesterday said that Eskom had now moved from a single buyer, particularly the integrated utility model, to a multimarket model where private generators were now able to participate and be on a competitive level with Eskom generation.
Rantwane stated during an EE Business Intelligence webinar that as a result, there has been a rise in interest in energy wheeling between private generators and buyers via bilateral agreements.
“This has been made possible by various interventions that are undertaken to tackle the country's energy crisis and particularly with regards to this is the amendments to schedule two of the electricity regulation act to remove the generation licensing threshold for private generators,” Rantwane said.
“So, the wheeling of energy has been identified as really a catalyst between a crucial link between the sellers and buyers of electricity.”
The restructuring of Eskom has led towards a liberalised electricity supply industry where a diversified range of large, medium and small generators and prosumers supply energy into the electricity grid based on economic principles through power purchase agreements, bilateral and multilateral contracts, traders and an electricity market(s), to customers connected to the grid and distribution networks.
Rantwane said Eskom has had a wheeling framework for more than a decade now since about 2009, and that there was a fair level of understanding of the wheeling framework that has been applied.
However, Rantwane said a national wheeling framework was still urgently required so as to standardise the calculation of wheeling charges across all of South Africa’s distributors, with such charges currently varying significantly from distributor to distributor.
“So the problem with this model is that it relies on measuring what the generator produces and then we do what we call a reconciliation on the offtakers' bill to credit that they wheel energy, and this obviously requires amendments to supply agreements that the offtakers would have with Eskom,” she said.
“So that is really the limitation of the traditional wheeling approach, that it doesn't cater for that multiple generator to multiple offtaker kind of a wheeling transaction.
“And obviously does not adequately address customers that are beyond the municipalities, because as we know that currently it's only limited to municipalities that have wheeling frameworks in place.”
Meanwhile, Eskom yesterday said it has completed the mechanical work of the replacement of the steam generators at 920MW Unit 1 of Koeberg Nuclear power station.
Immediately after the completion of the outage activities, the reactor will be reloaded with fuel, enabling the return to service of the unit.
The commissioning, including the necessary tests of the new steam generators, will take place while the unit is synchronised to the grid.
Eskom said that given all the outstanding activities, Koeberg Unit 1 was now planned to be commercially available on 3 November while the outage of Unit 2 has been postponed to 7 November to ensure that there was no simultaneous shutdown of both Koeberg units.