ESKOM ON THE EDGE

SA’S power utility had a laundry list of excuses for last week’s blackouts — which led to its available power plunging to just 27,000MW of its 45,561MW capacity. But it’s clear that unless the deeper cultural issues are fixed, the stories of shoddy mainte

By Valentine’s Day, Eskom had really hit the skids. A third of its electricity generating infrastructure was out of service — with most of it having unexpectedly broken down, while the rest was switched off due to planned routine maintenance.

It forced Eskom into using countrywide rolling blackouts to plug a 4,000MW hole, leaving it limping along with an inadequate supply of just 27,000MW to service the whole of SA. Considering that Eskom’s total capacity is meant to be 45,561MW (after billions had been spent on building two new power stations in the past decade), it was some collapse.

Officially, Eskom blamed everything: machines tripping, boiler tube leaks, turbine faults, steam pipe repairs, mill issues and other generator problems. Either way, the impact was that SA was plunged into loadshedding for six straight days, starting on February 10.

It shattered the illusion that, having got an almighty scare in December 2007 when load-shedding first brought the country to a standstill, the problem had been fixed during the next decade. In 2008, then president Thabo Mbeki apologised for the mess, and then public enterprises minister Alec Erwin admitted that the government had accepted that it “got its timing wrong”.

Instead, FM calculations show that over the past decade 12 CEOS, six chairs, 60 directors and 30 executives haven’t fixed the problem. And yet taxpayers paid their salaries and bonuses of R514m since 2009.

The first sign that January this year was likely to be spent in the dark was evident in November and December last year, when sporadic power cuts took place. It prompted public enterprises minister Pravin Gordhan to cancel all leave for Eskom executives during December, asking them to stay put and fix the coal shortages that had caused the blackouts. But as last week’s blackout showed, Eskom’s problems go far beyond coal shortages.

The utility operates 30 power stations, including the newly built Medupi and Kusile. Yet last week a total of 15,670MW of generating assets was on the fritz. It immediately undermined President Cyril Ramaphosa’s message, delivered to the mining indaba that week, that SA was “open for business” and keen to attract $100bn in foreign investment.

As Eskom tells it, the shortage of coal at 10 of its 30 power stations was caused by the failure of Optimum Coal — formerly owned by the Gupta family — to deliver on its coal contract since November 2017. In March last year Tegeta Exploration & Resources, which owns Optimum, went into business rescue and halted the supply of 750,000t of coal a month.

But instead of dealing with the politically connected contractor’s failure to meet its obligations, Eskom executives diverted coal from nearby power stations to cover up the Failure to deliver power is about more than coal supplies. There are big problems with red tape, morale and productivity shortfalls — thus spreading the problems to 10 power stations. It meant that Arnot, Hendrina, Majuba, Tutuka and Camden stations ran short of coal. At its worst, five other power stations, including Kriel and Matla, had fewer than 10 days’ coal left.

This week, Eskom confirmed to the FM that it had largely recovered the stockpiles. Total stock days sat at 63.2 at the end of January, said Eskom. If you exclude Medupi and Kusile (which are getting coal deliveries but are not yet operating at full capacity), the total stockpiles drop to 29.4 days. It is, at least, higher than Eskom’s prescribed minimum level of 26 days.

In fact, last year, Eskom signed 41 new coal supply contracts, to supply it with

106Mt of coal. These new contracts were expected to help all power stations recover and rebuild their stockpiles to 32 days’ worth by March this year. From there. all stations would recover to “expected levels” by November 2019.

Eskom expects to burn 116Mt of coal during its 2020 financial year, which starts in April. It has already contracted 134Mt to meet this requirement.

What it means:

So if things are going well for coal deliveries, what caused the plant breakdowns?

Eskom says 11 generating units broke down unexpectedly, due to various technical faults. And it was just bad luck that it happened at the exact time that 15 generating units had been pulled down for routine maintenance.

And, says Eskom, there is money available to fix units that are broken — some within days, some within months. Only unit five of the Lethabo power station, which also broke, will take up to a year to be fixed as it suffered “more significant damage.”

But that explanation of poor luck and circumstance doesn’t tell the full story. The truth is, things weren’t going swimmingly on the operational front before the units broke.