At the recent Mail & Guardian business breakfast, sponsored by SAS Institute, Eskom CEO Jacob Maroga made it clear to attendees that the power utility is indeed facing a crisis, and that belts may need to tightened a bit more into the foreseeable future.
According to Maroga, the company has made no secret that: "The margin is tight and will remain so until 2013 when new base-load stations start coming online. The next five to eight years will require a collaborative effort by all stakeholders to minimise the likelihood of power interruptions."
When talking about why South Africa even finds itself in a power crisis, Maroga alluded to a number of external factors that could not be predicted at the time. These include:
* Reserve margins are well below industry standards and leave no room for unplanned events.
* Ageing plants are being run longer and harder than initially designed for.
* The window of opportunity for doing maintenance is becoming tighter and tighter.
* Primary energy costs are increasing at a more rapid pace.
* The new build programme is greater than ever seen in South Africa.
"The bottom line is we are out of reserves, and when you are out of reserves, the need to tap into emergency reserves becomes more frequent, hence we find ourselves with limited supply and over-demand," he adds.
But it is not all doom and gloom, and the energy utility is furiously putting in plans to ensure the demands of the country are met. Some of these measures, which have already been reported quite extensively in the media, are in summary:
* The application by Eskom for a significant increase in tariffs.
* The exploration of massive capital investment which is already under way, including R343 billion over the next five years and is set to increase by more than R1.3 trillion in the long-term.
That said, Maroga made no bones about the fact that load-shedding remains a possibility. He also spoke about a national energy savings exercise which is already under way and that significant support from its shareholder had been announced with over R60 billion having been allocated in the budget.
In the short-term, however, he says the utility has to date: completed significant planned maintenance programmes freeing up valuable generation capacity for the winter months, worked hard to limit further unplanned outages, continued to build up coal stocks and are securing new sources of long-term coal supply, and moreover it is well into a significant capacity expansion programme that will see it through into the medium- and long-term.
"The provision of power, and the uninterrupted provision thereof is something that affects all of corporate South Africa," says Riad Gydien, country manager of SAS Institute South Africa. "It is therefore important for us to ensure we become responsible corporate citizens and help Eskom where we can, and more importantly adopt a more efficient approach to our energy consumption.
"At the end of the day, we need to help ourselves, as much as we need to rely on Eskom."
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