Talks held on capping electricity prices at SA Annual Coal Conference
THABANG Audat, the director for electricity supply policy at the Department of Energy, yesterday painted a bleak picture of the impact of Eskom’s non-compliance with the minimum legislation on air quality.
Speaking at the Annual Southern African Coal Conference, Audat said that state-owned Eskom had missed the December deadline to meet the minimum air quality standards, but addressing the non-compliance was likely to put pressure on supply.
“Eskom either must shut down the non-complying plants, which will result in the loss of 10 000 megawatts (MW), or the government must help Eskom to find money to reconfigure the non-complying plants. The problem is that the government is not in a position to inject money into Eskom to help,” Audat said.
Eskom has since December requested the Department of Environment Affairs for an exemption on compliance. “If the department says yes, Eskom will get time to address non-compliance. If the department says no, Eskom will shut down 10 000MW of energy. If you thought Stage 6 was worse, we will have Stage 10 load shedding once that happens,” said Audat.
The conference heard that the Independent Resource Development Plan (IRP), which was unveiled last year, was negative for the coal industry, because it was likely to reduce coal supply and result in job losses.
The IRP, the government’s blueprint up to 2030, is an electricity infrastructure development plan based on the least-cost electricity supply-demand balance, taking into account the security of supply and the environment.
The IRP envisages that coal, which currently accounts for about 77 percent of South Africa’s power generation, will be reduced to 59 percent of total generation in 2030.
Coal has come under attack by climate change activists for contributing to climate change, with global investors cutting back on investment.
Bonigani Mosta, the senior economist at the Minerals Council SA, described the IRP as an abusive spouse.
“IRP 2010 ushered a honeymoon phase between the IRP and the coal mining industry. We then had the draft IRP 2018, that is when we saw it had abusive traits… We were stupefied. Then it was gazetted in 2019. That reality struck. The spouse was shamelessly abusive,” said Motsa.
In contrast, Motsa said IRP 2010 had been optimistic, because it said in 2030 coal consumed by Eskom would be 130 million tons, projecting the creation of 75 000 jobs.
Motsa said the 2018 IRP, which was gazetted in 2019, included the need to introduce new technologies, but it did not translate into increased power generation, he said.
Xolile Mdolo, the chief executive of Zomhlaba Resources, said that the IRP demonstrated that coal producers had no voice in South Africa.
“We are sitting today as coal producers with no voice. We are not willing to raise our voice to say this industry has been so great. Where are the voices? As the coal industry led by captains here, we need to wake up and start fighting back,” Modolo said.