Hard work is behind Eskom’s current success
There should be no denying of the fact that Eskom performance has improved over the past 10 months (“Eskom’s good news story debunked”, June 24). This improvement is visible to the naked eye, but not to ideologues for whom a state-owned company is incapable of delivering basic services as effectively as Eskom currently does. The improved performance is a result of strong leadership from the top and hard work by Eskom employees.
The assertion that it is not Eskom’s performance but rather the economic slowdown that has kept the lights on for the past 10 months is disputed. The facts speak for themselves. The peak demand so far in 2016 was 34 899MW, 418MW higher than peak demand in 2015. Demand peaks in winter.
Although there has been a 2% reduction in energy consumption this year to date, the peak demand so far was higher than that of last year. The highest 2016 peak was easily supplied by available generation and without the use of the expensive diesel units or load-shedding.
Last year Eskom used five levers to meet demand: support by independent power producers (IPPs), mandatory demand reduction, contracted demand reductions, diesel generation and the use of Eskom’s generation fleet. This year, Eskom has not used mandatory demand reduction, and has decreased diesel usage to a load factor of 0.4% from 25% in 2015.
Last year Eskom was spending more than R1-billion a month on diesel, but this has been dramatically reduced: diesel expenditure for June 2016 was R19-million, down from the R854-million in October 2015.
In the past seven months Eskom increased its energy availability factor (EAF) from 69% to 78% (year to date). This has added new generation capacity of 2 599MW, excluding Medupi and Kusile. It achieved the highest peak capacity in four years at 39 067MW, met the high peak demand of 34 808MW and achieved the planned maintenance factor of 11% (year to date). Plus, the EAF for June 2016 is more than 80% and unplanned maintenance is 9.3%, the lowest since 2010.
Weeks 18 to 23 had higher peak demand than any period last year. This is the result of the efforts of Eskom’s employees, top leadership and strategic a shift, rather than the economic slowdown.
Doug Kuni [head of the South African Independent Power Producers Association] questions this performance. To him, an Eskom that is improving its performance is not good for his IPP ventures. The premise of IPP projects is partly that Eskom will underperform, so IPPs will be essential. This former Eskom engineer seemingly finds it hard to believe that Eskom is turning the corner. Yet Eskom fully supports the IPP projects as envisaged by the department of energy.
Other expert arguments focus on whether Eskom is sacrificing maintenance to attain these results. This, again, is unfounded. Planned maintenance sits at 11.2% against a target of 10%. Not only is Eskom undertaking more maintenance, it is also performing outages more efficiently.
Some experts believe Eskom and the new executive team were lucky. Luck is about not load-shedding for one day. Not load-shedding for 10 months and improving performance across core indicators has nothing to do with luck.
Some previously critical commentators, such as Chris Yelland, are starting to recognise that Eskom has put in the hard work and has a good executive team in place. Ideologues such as Kuni seem distressed that Eskom has improved performance, which has negated their opportunity to use load-shedding to support the “#EskomMustFall” movement.