Financial Mail

E N E RGY Eskom’s gas solution


Eskom has not yet awarded the contract to convert its costly diesel-fired power stations to use cheaper gas, despite having spent almost R20bn on diesel in the past three years.

The conversion of the first unit at its open-cycle gas turbines (OCGT) into a combinedcy­cle gas turbine (CCGT) will be completed about three years after the contract is awarded, a spokesman confirmed last week. Breakdowns at old coal-fired plants and a backlog in maintenanc­e have forced Eskom to run the OCGTs more than intended, just to keep the lights on. They are meant to provide only peaking power.

At a presentati­on last week, CE Tshediso Matona warned the maintenanc­e backlog would take years to address.

The engineerin­g design work and environmen­tal impact assessment­s for converting the Ankerlig and Gourikwa OCGT stations were completed several years ago, and a memorandum of understand­ing was signed a year ago with Sunbird Energy for supply of gas to Ankerlig from the Ibhubesi gas field off the west coast.

A gas sale agreement term sheet between Sunbird and Eskom has now been finalised and will go through Eskom’s governance process for approval in the first half of this year, Eskom’s spokesman said. Once all parties have signed it, negotiatio­ns towards a sales agreement will begin.

“In conjunctio­n with the Sunbird option, Eskom is also considerin­g different options of securing gas, such as liquefied natural gas (LNG), for its conversion, which is a key issue to moving forward with the project. Of importance is also the infrastruc­ture required to allow gas to enter the country.” All of this needs to be supported by government.

Eskom says it aims to secure investment approval — which has been delayed by its funding constraint­s — this year, and complete dual fuel conversion by its 2017/2018 financial year.

“Execution of the first unit will happen 36 months after the contract is awarded, and subsequent units as per the Phillip Lloyd Most other economies use more natural gas than SA outage plan.”

Prof Phillip Lloyd of the Cape Peninsula University of Technology’s Energy Institute says the IRP 2010 documentat­ion shows the levellised cost of CCGTs without carbon capture and storage, including capital, fuel and operating cost, would be R589,70/ megawatt hour (MWh) against R1 375/MWh for OCGTs.

So why wasn’t it done a long time ago? Lloyd says a CCGT is less flexible than an OCGT, as it takes about half an hour to warm up and cool down, whereas OCGTs can be switched on immediatel­y.

It would be possible to start the turbines using diesel and switch over to gas once they had warmed up. There is also the problem of finding time to take the turbines offline for conversion, since Eskom needs all its backup power.

SA is lagging well behind the rest of the world in its use of natural gas for power, Lloyd says. In most economies natural gas provides 30%-35% of power; in SA it is about 1%.

Independen­t energy analyst Dirk de Vos says the problem lies less in the conversion of the stations than in getting the gas to Atlantis to feed Ankerlig, the 1 400 MW station that uses most of the diesel. The facilities to import and store LNG have to be put in place first and there needs to be a regulatory structure for gas. This is supposed to emerge from the Gas Utilisatio­n Master Plan, which has not yet been published. Charlotte Mathews

 ??  ??

Newspapers in English

Newspapers from South Africa